Torrent Pharmaceuticals (500420) Q4 01/02 earnings summary

Executive summary

• FY 2001-02 sales and operating income grew 9%; reported PAT rose 20.3%, but growth excluding the deferred-tax credit was 5.8%.

• Domestic branded formulations remained the main revenue source; 31 products, including 8 first-in-India launches, were introduced.

• International expansion advanced through a Brazil acquisition, manufacturing upgrades and a focus on regulated generics markets.

Financial highlights

• Sales and operating income reached ₹442.22 crore versus ₹405.85 crore; sales alone were ₹431.94 crore versus ₹395.95 crore, up 9.1%.

• PBT before exceptional items rose to ₹65.40 crore from ₹56.76 crore; PAT was ₹49.86 crore versus ₹41.44 crore, up 20.3%.

• Excluding the deferred-tax credit, PAT growth was 5.8%; basic and diluted EPS increased to ₹23.56 from ₹18.51.

• Net exceptional charge was ₹0.75 crore versus ₹2.42 crore exceptional income; the current year included divestment gains offset by TGBL-related losses and write-offs.

Outlook and guidance

• FY 2002-03 product development was expected to continue at the current pace; plans included 14 new APIs, 80 formulations and four generic dossiers plus three NDDS products.

• R&D spending was planned to rise to 6% of sales, with discovery research targeted to reach around 50% of R&D and focus on cardiovascular, anti-diabetes and CNS areas.

• Plans included pursuing UK, Australian and South African regulatory approvals, expanding less-regulated markets and building alliances for generics in Europe.

• Domestic priorities included faster product launches, deeper focus on high-growth niche therapies, institutional markets and selective brand or company acquisitions.