Dr Reddy's Laboratories has posted a net profit of ₹470 crore for the third quarter ended December 31, 2016, a drop of 19 per cent over profit of ₹579 crore for the corresponding quarter last fiscal. The drop in sales in North America clipped numbers.
The revenue of the Hyderabad-based pharma major for the third quarter was down 7 per cent at ₹3706.5 crore against ₹3967.9 crore for the corresponding quarter last year.
While the company registered sequential growth of 3 per cent in revenues, it had to contend with 7 per cent drop when compared to the same period last year.
GV Prasad, Co-Chairman and CEO, said: “Performance in Q3 has delivered a modest sequential revenue growth of 3 per cent over the previous quarter. The company EBITDA improved on the back of enhanced emphasis on operational efficiencies across all businesses.”
The revenue from global generics was down by 9 per cent primarily on account of lower contribution from North America and Venezuela. However, it was up sequentially by 6 per cent.
The revenue from North America saw year-on-year decline of 15 per cent primarily on account of increased competition in valgancyclovir and injectibles franchise with continued pricing pressure.
During the quarter, the company launched five new products. As of December 2016, cumulatively, 92 generic filings are pending for approval with the USFDA, which include 90 ANDAs and two NDAs.
The company's gross profit margin declined by about 40 basis points over that of previous year primarily on account of price erosion in the US. This has been caused due to the new competitor's entry in some of key molecules.
Saumen Chakraborty, President and CFO, said the domestic market was hit temporarily and did not grow much due to the impact of demonetisation of higher value currency notes.
However, the situation is expected to get back to normalcy in the fourth quarter.