Biocon (BIOCON) Q4 09/10 earnings summary

Executive summary

• FY10 consolidated revenue rose 44% to Rs 24,048 million; EBITDA increased 31% to Rs 5,085 million and PAT before exceptional items grew 22% to Rs 2,932 million.

• Growth was supported by a 27% increase in biopharmaceuticals, expanding branded formulations and research services, and AxiCorp’s contribution to overseas sales.

• Strategy centers on biosimilars, research services, late-stage novel drug programs and expansion in India and emerging markets.

Financial highlights

• Consolidated revenue was Rs 24,048 million versus Rs 16,732 million; EBITDA was Rs 5,085 million versus Rs 3,878 million.

• Consolidated PAT before exceptional items reached Rs 2,932 million versus Rs 2,403 million; reported PAT was Rs 2,932 million versus Rs 931 million, reflecting prior-year exceptional losses.

• Standalone net sales rose 25% to Rs 11,281 million; total income increased 24% to Rs 12,289 million, and PAT before exceptional items rose 22% to Rs 2,484 million.

• Standalone domestic product sales increased 45%, while exports grew 5%; domestic sales represented 56.8% of net sales versus 48.8% in FY09.

• Recommended dividend was 70%, or Rs 3.50 per equity share; Rs 248 million was proposed for transfer to general reserves.

Outlook and guidance

• Domestic branded formulations targeted to contribute about one-quarter of revenue by 2015, with two new divisions planned and emphasis on brand building and launches.

• IN-105 Phase III study in India was expected to complete toward end-2010; a US clinical study for Type I diabetes was planned, following US IND approval.

• T1h was entering Phase III trials for psoriasis; clinical development of recombinant human insulin for European registration was expected to begin.

• Biosimilar insulin expansion into developed markets and MAbs into India and emerging markets were medium-term priorities; novel products were intended for global markets over the longer term.

• Global pharmaceutical market growth was forecast at 4–6% for 2010; emerging-market drug sales were expected to grow 14–17% through 2014 versus 3–6% in developed markets.