Dr. Reddy’s Laboratories Ltd. (NYSE: RDY) today announced its consolidated financial results for the fourth quarter and full year ended March 31, 2014 under International Financial Reporting Standards (IFRS). Key Highlights
- Consolidated revenues for FY 14 at Rs. 132.2 billion, year-on-year growth of 14%.
- Consolidated revenues for Q4 FY14 at Rs. 34.8 billion, year-on-year growth of 4%.
- Gross Profit Margin for FY 14 at 57.4% versus 52.1% as in FY 13.
- Gross Profit Margins for Q4 FY14 at 57.2% versus 50.4% as in Q4 FY 13.
- Research & Development (R&D) expenses for FY 14 at Rs. 12.4 billion, year-on-year increase of 62%. Expenses at 9.4% to revenues versus 6.6% to revenues as in FY13.
- Research & Development (R&D) expenses for Q4 FY14 of Rs. 4.0 billion.
- Selling, general & administrative (SG&A) expenses for FY 14 at Rs. 38.8 billion, year-on-year increase of 13%. Expenses at 29.3% to revenues versus 29.5% to revenues as in FY13.
- Selling, general & administrative (SG&A) expenses for Q4 FY14 at Rs. 10.3 billion.
- EBITDA for FY 14 of Rs. 33.2 billion, 25% of revenues; year-on-year growth of 19%.
- EBITDA for Q4 FY14 of Rs. 7.9 billion, 23% of revenues. Q4 FY 13 included one time settlement income of Rs. 1.2 billion received from Nordian Inc (formerly MDS Inc).
- Profit after tax for FY14 at Rs. 21.5 billion, 16% of revenues; year-on-year growth of 28%
- Profit after tax for Q4 FY14 at Rs. 4.8 billion, 14% of revenues.
- The company launched 54 new generic products, filed 51 new product registrations and 61 DMFs globally in FY 14.
- The company launched 13 new generic products, filed 22 new product registrations and 29 DMFs globally in Q4 FY14.
|All amounts in millions, except EPS||All US dollar amounts based on convenience translation rate of I USD = Rs. 60.00|
|Dr. Reddy’s Laboratories Limited and Subsidiaries|
|Consolidated Income Statement|
|Cost of revenues||939||56,369||42.6||928||55,687||47.9||1|
|Selling, general & administrative expenses||646||38,783||29.3||571||34,271||29.5||13|
|Research and development expenses||207||12,402||9.4||128||7,673||6.6||62|
|Other operating expense / (income)||(24||)||(1,416||)||(1||)||(41||)||(2,479||)||(2||)||(43||)|
|Results from operating activities||434||26,032||19.7||352||21,112||18.2||23|
|Net finance income||7||400||0||8||460||0||(13||)|
|Share of profit of equity accounted investees, net of income tax||3||174||0||2||104||0||67|
|Profit before income tax||443||26,606||20.1||361||21,676||18.6||23|
|Income tax expense||85||5,094||3.9||82||4,900||4.2||4|
|Profit for the year||359||21,512||16.3||280||16,776||14.4||28|
|Profit before income tax||443||26,606||361||21,676|
|Amortization & Impairment||30||1,794||40||2,378|
|All amounts in millions, except EPS||All US dollar amounts based on convenience translation rate of 1 USD = Rs. 60.00|
|Appendix 1: Key Balance Sheet Items|
|Particulars||As on 31st March 14||As on 31st March 13|
|Cash and cash equivalents and Other Investment||559||33,534||368||22,099|
|Property, plant and equipment||740||44,424||630||37,814|
|Goodwill and Other Intangible assets||245||14,697||234||14,021|
|Loans and borrowings (current & non-current)||746||44,742||613||36,760|
|Appendix 2: Revenue Mix by Segment|
|Russia & Other CIS||19,819||19||16,908||20||17|
|Rest of World||7,359||7||5,533||7||33|
|Rest of World||7,063||29||8,313||27||(15||)|
|Proprietary Products & Others||51||3,032||2||50||3,001||3||1|
- Revenues from North America for FY14 at Rs. 55.3 billion, year-on-year growth of 46%.
- Growth was largely driven by key launches in limited competition space. 9 new products were launched during the year, major being azacitidine, decitabine, zoledronic acid, donepezil 23mg and divalproex ER.
- Progress on market share expansion of key molecules namely metoprolol succinate and atorvastatin.
- 13 product filings in the US during the year. Cumulatively, 62 ANDAs are pending for approval with the USFDA of which 39 are Para IVs out of which 9 to have ‘First To File’ status.
- Revenues from Emerging Markets for FY14 at Rs. 27.2 billion, year-on-year growth of 21%.
- Revenues from Russia at Rs. 16.3 billion, year-on-year growth of 16%, largely driven by higher volumes of the top brands and the OTC portfolio.
- Revenues from CIS markets at Rs. 3.5 billion, year-on-year growth of 22%. Continuing momentum in existing products coupled with select launches from in-licensed portfolio.
- Revenues from Rest of World (RoW) territories at Rs. 7.4 billion recorded year-on-year growth of 33%. Of this Venezuela has shown strong growth despite currency devaluation in FY14.
- Revenues from India for FY14 at Rs. 15.7 billion, year-on-year growth of 8%.
- Growth driven by brands in chronic therapy, volume increase across NLEM covered portfolio and new product launches.
- IMS Mar ’14, Dr Reddy’s MAT Gr% 12.27% versus IPM MAT Gr% of 9.9%. (Source: IMS).
- Biosimilars portfolio stable at Rs. 1.13 billion in FY14
- Revenues from PSAI for FY14 at Rs. 24 billion, year-on-year decline of 22%.
- Challenging year on the external market front due to lower demand from key customers coupled with lesser number of launches as compared to the previous year.
- During the year, 61 DMFs were filed globally, including 12 in the US and 13 in Europe. The cumulative number of DMF filings as of March 31, 2014 is 631.
- Gross profit margin at 57.4% in FY14 registered strong 530 basis points improvement over the last year. Gross profit margin for Global Generics (GG) and PSAI business segments are at 65.8% and 20.2% respectively for FY14.GG gross margin improvement primarily on account improved mix of high margin new product launches in North America.
- Selling, General and Administration (SG&A) expenses at Rs. 38.8 billion, year-on-year increase of 13%. The increase is primarily on account of annual increments, additional manpower deployment in select areas, sales & marketing spend for events specific to the year and the effect of rupee depreciation against multiple currencies.
- Research & development expenses at Rs. 12.4 billion, year-on-year growth of 62%. 9.4% of revenues in FY14 as compared to 6.6% of revenues in FY13. The increase is in line with our planned scale-up in development activities.
- Net Finance income at Rs. 400 million compared to Rs. 460 million in FY13. The change is on account of :
- Net incremental forex benefit of Rs. 7 million
- Incremental net interest expense of Rs. 71 million
- EBITDA for FY14 at Rs. 33.2 billion, year-on-year growth of 19%; 25% of revenues.
- Profit after Tax in FY14 at Rs. 21.5 billion, year-on-year growth of 28%; 16% of revenues.
- Diluted earnings per share in FY 14 at Rs. 126.04
- Capital expenditure for FY14 is Rs. 10.2 billion.
|All amounts in millions, except EPS||All US dollar amounts based on convenience translation rate as on 31st March, 2014 USD = Rs. 60.00|
|Appendix 3: Q4 FY4 Consolidated Income Statement|
|Particulars||Q4 FY14||Q4 FY13||Growth %|
|Cost of revenues||248||14,887||42.8||276||16,554||49.6||(10||)|
|Selling, general & administrative expenses||172||10,307||29.6||145||8,722||26.1||18|
|Research and development expenses||66||3,985||11.4||39||2,326||7.0||71|
|Other operating expense / (income)||(4||)||(226||)||(0.7||)||(27||)||(1,631||)||(4.9||)||(86||)|
|Results from operating activities||98||5,857||16.8||124||7,427||22.2||(21||)|
|Net finance income||3||163||0.5||7||397||1.2||(59||)|
|Share of profit of equity accounted investees||1||48||0.1||0||26||0.1||91|
|Profit before income tax||101||6,068||17.4||131||7,850||23.5||(23||)|
|Income tax expense||21||1,252||3.6||36||2,141||6.4||(42||)|
|Profit for the period||80||4,816||13.8||95||5,709||17.1||(16||)|
|Appendix 4: EBITDA Computation|
|Particulars||Q4 FY14||Q4 FY13|
|Profit before income tax||101||6,068||131||7,851|
|Appendix 5: Revenue Mix by Segment|
|Q4 FY14||Q4 FY13||Growth %|
|Russia & Other CIS||4,519||17||4,519||20||(0||)|
|Rest of World||1,960||7||1,322||6||48|
|Rest of World||1,754||26||2,105||21||(17||)|
|Proprietary Products & Others||14||851||2||11||661||2||29|
About Dr. Reddy'sDr. Reddy’s Laboratories Ltd. (NYSE: RDY) is an integrated global pharmaceutical company, committed to providing affordable and innovative medicines for healthier lives. Through its three businesses - Pharmaceutical Services and Active Ingredients, Global Generics and Proprietary Products – Dr. Reddy’s offers a portfolio of products and services including APIs, custom pharmaceutical services, generics, biosimilars and differentiated formulations. Major therapeutic focus is on gastro-intestinal, cardiovascular, diabetology, oncology, pain management and anti-infective. Major markets include India, USA, Russia-CIS and Europe apart from other select geographies within Emerging Markets. For more information, log on to: www.drreddys.com Note: All discussions in this release are based on consolidated IFRS financials.