Wockhardt has registered strong improvement during the third quarter ended December 2010 and posted net profit of Rs.141.67 crore as against heavy net loss of Rs.181.23 crore in the corresponding period of last year. The company turned into profits mainly due to reduction in employees cost, lower R&D expenditure and profit from exceptional items. Its sales increased by 6.9 per cent to Rs.950.80 crore from Rs.889.33 crore.


During the quarter, employees cost drop by 13.1 per cent to Rs.122.91 crore from Rs.141.43 crore, R&D expenditure declined to Rs.8.44 crore from Rs.11.80 crore and it has shown exceptional item gain of Rs.16.53 crore as against a loss of Rs.239.32 crore. Exceptional items includes amount received on release of Escrow towards divestment of animal health business, receipt of claim of insurance, reversal of excess provision made on account of settlement of loan/disputed derivative liabilities and towards loss of assets. Wockhardt's EBDITA moved up by 84.4 per cent to Rs.250.12 crore from Rs.135.61 as its total expenditure declined to Rs.737 crore from Rs.786 crore in the last period.


To overcome the financial problem, the company has issued 11,297,638 non convertible cumulative redeemable preference shares of Rs.56.49 crore to various banks during the quarter under review. The outstanding liabilities of the company are restructured under the aegis of corporate debt restructuring (CDR) scheme. The company pointed out that in respect of unilaterally terminated contracts pertaining to crystallised derivatives/hedging liabilities which are disputed, the amount payable is presently not ascertainable and hence not provided.


For the nine months ended December 2010, Wockhardts' net sales increased only by 1.7 per cent to Rs.2813 crore from Rs.2766 crore in the similar period of last year. Its net loss reduced to Rs.71.31 crore from Rs.425.30 crore. Its EBDITA worked out to Rs.657.31 crore as against Rs.497.81 crore . It incurred foreign exchange loss of Rs.22.84 crore as against a gain of Rs.22.48 crore in the same period of last year. The loss from the exceptional items reached to Rs.401.09 crore as compared to Rs.641.52 crore in the last period.


For the fifteen months ended March 2010, Worckhardt's net sales amounted to Rs.4501 crore and its net loss went up to Rs.1001 crore.