Sharon Bio-Medicine, a Rs.1,300 crore plus Mumbai-based pharma company, has suffered heavy setback during the second quarter ended December 2014 mainly due to lower sales and higher interest cost and foreign exchange loss. However, with heavy loss it is now facing tremendous financial problems and its share price is moving below Rs.20 on BSE. Promoters are holding over 59 per cent of equity capital.

The company incurred a net loss of Rs.103.37 crore as against a net profit of Rs.15.99 crore in the corresponding period of last year. EBDITA was negative at Rs.81.37 as compared to Rs.39.61 crore. Its net sales also declined sharply by 29.2 per cent to Rs.237.93 crore from Rs.335.92 crore. With net loss, EPS worked out to negative Rs.9.79 as against positive Rs.15.14 in the last period.

For the first six months ended December 2014, Sharon's net loss amounted to Rs.80.75 crore as against a net profit of Rs.31.43 crore in the similar period of last year and its net sales declined by 13.6 per cent to Rs.562.84 crore from Rs.651.32 crore. Its interest cost increased to Rs.30.58 crore from Rs.24.95 crore. The company provided Rs.15.53 crore as exceptional items in respect of foreign exchange loss as against foreign exchange gain of Rs.2.62 crore.

The company's short-term and long-term borrowings increased to Rs.725 crore as at the end of June 2014 from Rs.644 crore in the previous year which put pressure on bottom line during the quarter ended December 2014.

Sharon Bio has recommended dividend at the rate of 18 per cent which amounts to Rs.0.36/- per equity share of Rs.2 each for the Financial Year ended June 30, 2014. The company has split its share in the ratio of 1:5 subdividing the face value of share to Rs.2 from Rs.10 during the quarter ended March 2014 and issued bonus shares in the ratio of 1:1. After the split and bonus shares, its equity capital increased to Rs.21.11 crore as at the end of June 2014. from Rs.10.56 crore and its reserves & surplus amounted to Rs.333.27 crore.