Glenmark Pharmaceuticals (GLENMARK) Q4 05/06 earnings summary

Executive summary

• FY06 consolidated revenue rose 23.78% to Rs 7,575.89 million; PAT fell 17.89% to Rs 879.76 million, mainly as out-licensing revenue declined to Rs 265.68 million from Rs 886.06 million.

• Core business revenue, excluding out-licensing, grew 39.66%; discovery research, India formulations and US generics were strong, while API faced price erosion and capacity bottlenecks.

Financial highlights

• Consolidated turnover was Rs 7,575.89 million versus Rs 6,120.53 million; other income rose to Rs 128.20 million from Rs 52.29 million.

• Consolidated PBIDT was Rs 1,500.26 million versus Rs 1,609.80 million; PBT was Rs 1,120.72 million versus Rs 1,272.94 million.

• Consolidated PAT was Rs 879.76 million versus Rs 1,071.41 million; reported basic EPS was Rs 7.28 versus Rs 8.97 and diluted EPS was Rs 6.41 versus Rs 8.16.

• Consolidated cost of sales rose to Rs 3,817.33 million from Rs 2,714.68 million; selling and operating expenses rose to Rs 2,123.16 million from Rs 1,507.15 million.

Outlook and guidance

• FY07 consolidated revenue target: Rs 12,742 million; net profit target: Rs 2,530–2,760 million, based on a projected exchange rate of Rs 46 per US dollar.

• FY07 targets included formulation revenue growth above 10% in India, 40% in ROW and 100% in Latin America and the US; API revenue growth target was above 30%.

• Planned R&D milestones included progressing Oglemilast and GRC 8200 through Phase II, moving four preclinical molecules into Phase I and concluding two licensing collaborations.

• Plans included filing 15–20 US ANDAs, marketing 18–24 US ANDAs, filing over 50 Latin American dossiers and filing 12–14 API DMFs.