Ranbaxy surprises with loss, forecasts tepid sales growth

The company had posted a net loss of Rs 2,983 cr for the corresponding quarter in the previous year

Ranbaxy Laboratories, India's top drugmaker by sales, said its base business would grow a modest 10 per cent in 2013 after reporting a surprise quarterly loss on product recall charges, sending its shares down four per cent.

Dragged into the red by the recall of its generic version of Lipitor from the US market as well as foreign exchange losses, drug maker Ranbaxy Laboratories on Tuesday reported a net loss of Rs 492 crore for the quarter ended December 31, 2012. The company set aside Rs 186 crore on account of inventory write-off, sales loss and customer claims, etc., following its voluntary recall of Lipitor generic from the US market during the quarter. Ranbaxy recently restarted production of the drug for the US.

The company follows January-December financial year. The firm also incurred a mark-to-market loss of Rs 262 crore on long-term derivative contracts and foreign currency loans owing to a weaker rupee, said Ranbaxy in a statement.

The company had posted a net loss of Rs 2,983 crore for the corresponding quarter in the previous year.

Consolidated revenues of the company for the quarter also dipped year-on-year. The firm reported sales of Rs 2,671 crore for the October-December quarter, compared to Rs 3,752 crore a year ago.

“We have made good progress on the Consent Decree honouring all our commitments till date. We continue to remain confident of monetising our large ANDAs (abbreviated new drug applications),” said Arun Sawhney, CEO and managing director, Ranbaxy.

The street is, however, left disappointed in the absence of any specific time-frame indication coming from the company’s management about the ongoing consent decree with the US regulatory authorities and resolution of issues there.

Shares of Ranbaxy Laboratories on Tuesday closed at Rs 417.30 per scrip on the Bombay Stock Exchange, down 3.66 per cent from their previous close.

The company said it expects to achieve sales of over Rs 12,000 crore in the current financial year ending December 2013, compared to Rs 12,460 crore reported in 2012. It is also expecting some first-to-file opportunities in the US with exclusive marketing rights in the current year.