Biocon (BIOCON) Q4 02/03 earnings summary

Executive summary

• FY 2002-03 revenue reached Rs 2,820mn, up 58% YoY; EBITDA rose to Rs 745mn and PAT to Rs 444mn, with statins driving biopharmaceutical growth.

• Export growth, regulated-market statin sales and strong custom research demand supported expansion; investment continued in manufacturing capacity and R&D.

• Apr-Sep 2003 trading update: revenue Rs 2,584mn, PAT Rs 603mn and EBITDA margin 34%; EPS Rs 657 annualised.

Financial highlights

• US GAAP FY revenue was Rs 2,819.9mn vs Rs 1,789.9mn in FY 2001-02; gross profit Rs 1,165.3mn and operating income Rs 611.1mn.

• US GAAP net income was Rs 444.3mn vs Rs 203.0mn YoY; EPS was Rs 237.02 vs Rs 118.83.

• Indian GAAP consolidated profit after tax was Rs 435.1mn vs Rs 184.9mn; total revenue was Rs 2,845.2mn vs Rs 1,654.7mn.

• Exports rose to 48% of consolidated annual sales from 36% in FY 2001-02; headline sales grew 58% and API sales grew 79% YoY.

• Operating cash flow was Rs 494.1mn; investing cash outflow was Rs 453.4mn and closing cash and cash equivalents were Rs 26.3mn.

Outlook and guidance

• Statin capacity expansion was planned; US FDA inspections for simvastatin, pravastatin sodium and submerged-fermentation lovastatin were expected in FY 2003-04.

• Recombinant human insulin launch was targeted for the following year; Tacrolimus and human insulin were expected to commercialise within 6-12 months.

• Biocon Bio Pharmaceuticals planned a multi-product biologicals facility costing approximately Rs 1,000mn over 2-3 years; the JV expected production in calendar 2004.

• Syngene’s new research facility was expected to be operational in 2004; Clinigene’s human pharmacology unit was expected to start by September 2003.