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Jubilant Life Sciences Ltd.

BSE: 530019 Sector: Health care
NSE: JUBILANT ISIN Code: INE700A01033
BSE LIVE 09:07 | 21 Aug 702.00 -2.35
(-0.33%)
OPEN

702.00

HIGH

702.00

LOW

702.00

NSE 15:59 | 18 Aug 703.40 -18.70
(-2.59%)
OPEN

718.90

HIGH

718.90

LOW

691.00

OPEN 702.00
PREVIOUS CLOSE 704.35
VOLUME 15
52-Week high 879.10
52-Week low 427.65
P/E 139.01
Mkt Cap.(Rs cr) 11,183
Buy Price 702.00
Buy Qty 85.00
Sell Price 727.00
Sell Qty 171.00
OPEN 702.00
CLOSE 704.35
VOLUME 15
52-Week high 879.10
52-Week low 427.65
P/E 139.01
Mkt Cap.(Rs cr) 11,183
Buy Price 702.00
Buy Qty 85.00
Sell Price 727.00
Sell Qty 171.00

Jubilant Life Sciences Ltd. (JUBILANT) - Director Report

Company director report

Your Directors are happy in presenting the Thirty Eighth Annual Report together withthe Audited Standalone and Consolidated Financial Statements for the year ended March 312016.

OVERVIEw

Jubilant Life Sciences Limited ('the Company' or 'Jubilant') is an integrated globalPharmaceutical and Life Sciences company engaged in manufacture and supply of ActivePharmaceutical Ingredients Solid Dosage Formulations Radiopharmaceuticals AllergyTherapy Products and Life Sciences Ingredients. It also provides services in ContractManufacturing of Sterile Products and Drug Discovery Solutions. The Company’sstrength lies in its unique offerings of Pharmaceutical and Life Sciences products andservices across the value chain. With 11 world-class manufacturing facilities in India USand Canada and a team of about 6200 multicultural people across the globe the Company iscommitted to deliver value to its customers spread across over 100 countries. The Companyis well recognized as a 'Partner of Choice' by leading pharmaceuticals and life sciencescompanies globally. For more information please visit the Company’s websitewww.jubl.com.

RESULTS OF OPERATIONS AND STATE OF COMPANY’S AFFAIRS

(i) Standalone Financials

Income from Operations

In the Financial Year 2015-16 on standalone basis the Company recorded income fromoperations of Rs. 26562 million.

International Revenues

International business contributed 46% to the Net Revenue from operations at Rs. 12339million.

EBITDA

For the year ended March 31 2016 Earnings before Interest Taxes Depreciation andAmorization (‘EBITDA’) stood at Rs. 4026 million with EBITDA margins at 15%.

Reported Net Profit/ Loss after Tax and EPS

Reported Net Profit after Tax was Rs. 791 million in the Financial Year 2015-16. BasicEarnings Per Share (‘EPS’) stood at Rs. 4.96. However Normalised Net Profitafter Tax stood at Rs. 1010 million after adjusting exceptional loss of Rs. 219 millionmainly on account of Foreign Currency Monetary Item Translation Difference Account(‘FCMITDA’) amortisation of Rs. 252 million on account of unrealised foreignexchange loss amortised over the tenure of the loan as per Indian Accounting Standardsforeign exchange gain of Rs. 37 million and mark-to-market book loss of Rs. 4 million onforward covers outstanding. Normalised EPS stood at Rs. 6.34 for the Financial Year2015-16.

FINANCIAL RESULTS (STANDALONE)

(Rs. /million)

Particulars Year ended March 31 2016 Year ended March 31 2015
Income from Operations 26075 31406
Other Operating Income 487 357
Total Income from Operations 26562 31763
Total Expenditure 23153 29001
Operating Profit 3409 2762
Other Income 617 1064
EBITDA including Other Income 4026 3826
Depreciation 869 1074
Finance Cost 2024 2271
Profit after Depreciation and Finance Cost but before Exceptional Items 1133 481
Exceptional Item - (Gain)/ Loss 219 (1982)
Tax Expenses 123 412
Reported Net Profit/ (Loss) After Tax 791 2051
Profit brought forward from previous year 7711 6388
Adjustment on account of (deconsolidation)/ consolidation of Jubilant Employees Welfare Trust (67)
Adjustment on account of revised useful life of fixed assets (86)
PROFIT AVAILABLE FOR APPROPRIATION 8502 8286
Which the Directors have appropriated as follows:
- Proposed Dividend on Equity Shares 478 478
- Tax on Dividend on Equity Shares* 37 97
- Transfer to General Reserve
Balance to be carried forward 7987 7711

*After reversal of dividend distribution tax provided on the proposed dividend for theyear ended March 31 2015 amounting to Rs. 60.21 million on dividend received from asubsidiary company during the year ended March 31 2016.

(ii) Consolidated financials

The Consolidated Financial Statements prepared in accordance with the provisionsof the Companies Act 2013 (the ‘Act’) SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 (the ‘Listing Regulations’) and AccountingStandard-21 on Consolidated Financial Statements (AS-21) form part of the Annual Report.

income from Operations

In the Financial Year 2015-16 income from operations was Rs. 58023 million down fromRs. 58262 million in the previous year.

International business contributed 73% to the Revenue from Operations at Rs. 42595million. Sales from key developed markets were at Rs. 35432 million contributing 61% tothe Revenue of the Company. Revenues from domestic market stood at Rs. 15428 millioncontributing 27% to overall revenues.

Pharmaceuticals segment

This segment includes revenue lines of (i) Generics comprising Active PharmaceuticalIngredients (‘APIs’) and Solid Dosage Formulations (ii) SpecialtyPharmaceuticals (sterile products) comprising Radiopharmaceuticals Allergy TherapyProducts and CMO of Sterile Injectables (iii) Indian Branded Pharmaceuticals and (iv) DrugDiscovery Solutions. In the Financial Year 2015-16 Income from Operations from thissegment was Rs. 30548 million contributing 53% to the total revenue and a growth of 14%for the Company. EBITDA stood at Rs. 8895 million with margins being 29% up from Rs.4447 million with 17% margin in the previous year.

life science ingredients segment

This segment comprises our Speciality Intermediates Nutritional Products and LifeScience Chemicals businesses. In the Financial Year 2015-16 income from operations fromthis segment stood at Rs. 27475 million down from Rs. 31442 million in the previousyear contributing 47% to our overall revenues. EBITDA stood at Rs. 4467 million with 16%margins for the year as compared to Rs. 3220 million with 10% margins in the previousyear. The segment performance was driven by better price realization in NutritionalProducts and better performance in Fine Ingredients. The segment also witnessed volumereduction in Advance Intermediates due to lower demand of agrochemicals and increasedcompetition in China. The Life Sciences Chemicals revenue were lower due to price ledcompetition from crude derived substitutes and lower demand.

EBITDA and net profit

For the year ended March 31 2016 EBITDA stood at Rs. 12914 million with EBITDAmargins at 22.3% compared to EBITDA of Rs. 7317 million with margin of 12.6% in theprevious year. Net Profit after Tax was Rs. 4315 million in the Financial Year 2015-16with EPS of Rs. 27.09 for Rs. 1 paid-up share.

DIVIDEND

The Board is pleased to recommend a dividend of 300% i.e. Rs. 3 per fully paid upequity share of Rs. 1 for the year ended March 31 2016. Total dividend payout of Rs.514.91 million includes tax on dividend of Rs. 37 million (net of reversal of dividenddistribution tax of Rs. 60.21 million for the year ended March 31 2015 on account ofdividend received during the year from a subsidiary company). The payment of dividend issubject to approval of the shareholders at the forthcoming Annual General Meeting(’AGM’) of the Company.

CAPITAL STRUCTURE

(a) Share Capital

During the year there has been no change in the authorised subscribed and paid-upshare capital of the Company. As at March 31 2016 the paid-up share capital stood at Rs.159281139 comprising of 159281139 equity shares of Rs. 1 each.

(b) Employees stock Option plans (esOps)

The Company has two employees stock option plans namely Jubilant Employees Stock OptionPlan 2005 ('Plan 2005') and JLL Employees Stock Option Plan 2011 ('Plan 2011'). During theyear there was no material change in Plan 2005 and Plan 2011 and both the plans are incompliance with SEBI (Share Based Employee Benefits) Regulations 2014 (the 'SEBI ESOPRegulations'). Plan 2005: During the year 81178 options were exercised by the optionholders. As on March 31 2016 8467 Options were outstanding under the Plan 2005. EachOption entitles the holder to acquire five equity shares of Rs. 1 each of the Company atthe exercise price fixed at the time of grant being the market value as per the erstwhileSEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999(the ‘SEBI Guidelines’). Plan 2011: During the year 523080 Options wereexercised by the option holders. As on March 31 2016 431256 Options were outstandingunder the Plan 2011. Each Option entitles the holder to acquire one equity share of Rs. 1of the Company at the exercise price fixed at the time of grant being the market value asper the SEBI Guidelines. No dilution of capital is expected due to exercise of Options asit is envisaged to transfer the shares held by Jubilant Employees Welfare Trust to theemployees on exercise of Options.

The details pursuant to the SEBI ESOP Regulations have been placed on the website ofthe Company and weblink of the same is http://jubl.com/Uploads/image/177imguf_ESOP_Disclosure.pdf.

Subsidiaries

As on March 31 2016 the Company had 47 subsidiaries. Brief particulars of theprincipal subsidiaries are given below: