Lupin (500257) Q4 03/04 earnings summary

Executive summary

• Revenue rose 22% to Rs 1,232.67 crore; net profit before extraordinary items doubled to Rs 145.98 crore, the highest profit in the period’s history.

• Developed-market expansion, value-added products, R&D and alliance-led market access formed the growth strategy; the first US generic and branded launches established a US foothold.

Financial highlights

• Gross sales and operating income increased 22% to Rs 1,232.67 crore; net sales were Rs 1,179.56 crore.

• Operating profit before extraordinary items rose 51% to Rs 280.17 crore; PBT before extraordinary items rose 106% to Rs 199.62 crore.

• Net profit before extraordinary items doubled to Rs 145.98 crore; after Rs 50.89 crore of net-of-tax extraordinary write-offs, reported net profit was Rs 95.09 crore, up 30%.

• Advanced-market revenue more than doubled to Rs 2,289 million, 19% of total sales; export growth drove the increase.

Outlook and guidance

• Targeted at least 14 ANDA filings in 2004-05, spanning Para III, Para IV and oral controlled-release products.

• Expected product introductions, higher-value mix, improved asset utilisation and cost rationalisation to support growth; management anticipated high investment expenditure near term.

• Planned continued infrastructure investment and expansion in developed markets, including initiatives for Japan, Australia and New Zealand.

• Proposed a $2 million investment over two years to establish an Australian subsidiary for registrations and branded-generic marketing.