Ranbaxy Laboratories, a subsidiary company of Daiichi Sankyo Co, Japan, has posted handsome growth in bottom line during the year ended December 2010. The consolidated net profit went up to Rs.1,497 crore during the year 2010 from Rs.296 crore in the previous year with earnings per share of Rs.35.57 as against Rs.7.05. The company management declared equity dividend of Rs.2 per share for face value of Rs.5 each after gap of two years. Despite strong growth in bottom line, Ranbaxy scrip nosedived by 3.7 per cent to Rs.494.20 on Bombay Stock Exchange today.
The consolidated net sales increased by 16.5 per cent to Rs.8,535 crore from Rs.7,329 crore mainly on account of significant growth of 80 per cent in US sales to Rs.2,745 crore. Its global sales increased by 23 per cent to Rs.8,551 crore. Emerging markets accounted for 50 per cent of sales and developed markets contributed 44 per cent. The sales in North America increased by 67 per cent to Rs.3,023 crore. Its sales in India increased by 8 per cent to Rs.1,759 crore. Of this the Global Consumer Healthcare business recorded sales of Rs.249 crore, a growth of 17 per cent during 2010.
Ranbaxy's sales in CIS region improved by 18 per cent to Rs.463 crore and that in Africa region improved by 23 per cent to Rs.704 crore. Its sales in Latin America also moved up by 17 per cent to Rs.379 crore. However, the API business improved only by 3 per cent to Rs.524 crore during 2010.
Arun Sawhney, managing director, said, “We have had a strong year attributable in large measure to the robust revenue growth in our key geographies and the realizations from our first-to-file (FTF) opportunities, in the US. On the cost side, we have gained from greater efficiencies in manufacturing.”
The net profit was significantly higher due to other operating income of Rs.425.32 crore comprising export benefits and income arising out of milestones payments, patent/exclusivity settlements and non-compete fee. Further, it transferred certain assets pertaining to its New Drug Discovery Research Centre to Daiichi Sankyo India Pharma Pvt Ltd for an aggregate consideration of around Rs.145 crore during 2010. Its employees cost went up by 6.2 per cent to Rs.1,506 crore from Rs.1,417 crore and its provision for depreciation increased by 38.9 per cent to Rs.371 crore from Rs.268 crore. Its EBDITA touched to Rs.1,839 crore as against Rs.584 crore in the previous year.
It earned higher interest income of Rs.279 crore as compared to Rs.240 crore in the last year. Its foreign exchange gain on loans amounted to Rs.140.70 crore as against Rs.149.31 crore. The company successfully cut down interest cost to Rs.61.39 crore from Rs.71.04 crore. Ranbaxy has made provision of Rs.222 crore for diminution in the value of investment in investment held in Zenotech Laboratories and Shimal Research Laboratories Ltd. Further, it provided for Rs.18.48 crore toward share in loss of associates and minority interest. Research and Development expenditure, on standalone basis, increased marginally to Rs.478 crore from Rs.472 crore in the previous year.
As against the equity capital of Rs.210.52 crore, Ranbaxy's reserves & surplus increased by 36.2 per cent to Rs.5,381 crore from Rs.3,950 crore in the previous year.