Indoco Remedies (INDOCO) Q4 09/10 earnings summary

Executive summary

• FY10 total revenue reached Rs 4,023.6 million versus Rs 3,552.6 million; PAT rose to Rs 420.9 million from Rs 314.4 million.

• Domestic and international businesses grew 11.63% and 18.49%, respectively, amid the economic slowdown.

• Strategic restructuring, new domestic divisions and overseas alliances supported growth plans and expanded access to regulated and emerging markets.

Financial highlights

• Net sales were Rs 3,982.85 million, up from Rs 3,506.35 million; total income was Rs 4,033.49 million versus Rs 3,545.67 million.

• Operating profit increased 27.07% to Rs 531.9 million; PBT was Rs 431.3 million and PAT Rs 420.9 million.

• Basic and diluted EPS rose to Rs 34.26 from Rs 25.59; no exceptional items were recorded in FY10.

• Raw-material costs rose to 43.66% of sales from 42.66%, reflecting higher input prices, product mix and rupee depreciation; staff cost increased to Rs 564.6 million.

Outlook and guidance

• Plans called for a larger portfolio of own-name US ANDAs, European dossier registrations through DCP/MRP routes, and development of patentable NDDS products.

• Goa tablet-plant expansion was targeted for commissioning by end-2010; API capacity expansion and potential new API plants were also planned.

• Watson and Aspen alliances were expected to support medium-term export growth; own marketing authorizations were intended to improve margins and create more sustainable business.