Wockhardt (WOCKPHARMA) Q4 97/98 earnings summary

Executive summary

• FY98 sales rose 36% to Rs 4,022 million; operating profit increased 21% to Rs 639 million and PAT grew 14% to Rs 708 million.

• Merind acquisition lifted reported therapeutic-market coverage from 29% to 43% and positioned the business as India’s fourth-largest pharmaceutical company; Wallis Laboratories added a UK manufacturing and marketing base.

• Research, exports and global market access were central growth priorities, alongside integration of acquisitions and expansion into new therapeutic areas.

Financial highlights

• FY98 sales Rs 4,022m vs Rs 2,951m in FY97; total income Rs 4,119m, up 33% as other income fell to Rs 97m from Rs 154m.

• Operating profit Rs 639m, up 21%, with 16% operating margin; PAT Rs 708m, up 14% from Rs 622m.

• Market Value Added rose 63% to Rs 4,467m; estimated brand value was Rs 3,319m.

• Since the December 1992 IPO, sales increased 350% and profits rose more than sixfold.

Outlook and guidance

• Ranitidine tablet USFDA approval was expected imminently; plans called for three ANDA and six DMF filings in FY99, followed by six more DMFs the next year.

• China manufacturing JV targeted commercial operations during FY99; the recombinant biotechnology facility was expected to be operational by end-1999.

• Five products using patented drug-delivery technology were in assessment, with four more under development; post-2005 patent-regime preparation included new-molecule research.

• Merind cost synergies and new-product opportunities were identified for capture within 18 months; Vitamin B12 capacity expansion of 2–3x was planned.