India's Gland Pharma reports lower Q4 profit on soft demand
BENGALURU (Reuters) - Indian generic injectables maker Gland Pharma Ltd reported a 56% decline in fourth-quarter profit on Thursday, hurt by soft demand in its key operating markets.
The company, majority of which is owned by China's Shanghai Fosun Pharmaceutical Group Co, said its consolidated profit before exceptional items and tax fell to 1.68 billion rupees ($20.54 million) for the quarter ended March 31, from 3.80 billion rupees a year earlier.
Gland Pharma said it had a one-off expense of 564.6 million rupees as a provision for credit impaired financial assets related to a customer which filed for bankruptcy in the U.S. court. Accounting for this, the company's net profit came in at 786.8 million rupees.
Its earnings before interest, taxes, depreciation, and amortisation (EBITDA) margin contracted to 21% from 32% a year earlier.
Revenue from operations fell about 29% to 7.85 billion rupees, dragged by weak sales in domestic and international markets as well as production line shut down at a facility in Hyderabad.
Hyderabad-based Gland Pharma, which primarily operates under a business-to-business (B2B) model, generally derives 70% of its revenue from core markets that include the United States, Europe, Canada, Australia and New Zealand.
Its revenue from core markets dropped 23% from a year earlier.
The company operated in a "challenging business environment (in the year ended March)," Gland Pharma CEO Srinivas Sadu said in a statement.
Shares of the company closed 0.5% lower at 1331.95 rupees ahead of its results. The stock had declined about 20% in the March quarter, compared with a 5% decline in the Nifty Pharma index.
Majority stakeholder Fosun Pharma withdrew plans to sell its stake in Gland Pharma, local media ET Now reported last month, citing sources.
($1 = 81.7800 Indian rupees)
(Reporting by Rama Venkat in Bengaluru; Editing by Shweta Agarwal)