Dr Reddy's posts 33% rise in profit before tax at Rs 766 crore in Q2

The drug major has reported a 26% increase in revenues at Rs 4,801 crore for Q2

Riding on one-off gains, Dr Reddy’s Laboratories (DRL) has reported a 33 per cent jump in profit before tax (PBT) at Rs 766.4 crore for the September quarter (Q2). Its net profit has more than doubled to Rs 1,092.5 crore.

The drug major has reported a 26 per cent increase in revenues at Rs 4,801 crore for Q2 from Rs 3,797.8 crore in the year-ago period despite a flat growth in the US.

The company’s top line growth was largely hinged on Rs 722.9-crore licence fee received towards the sale of its anti-migraine drug to Upsher-Smith Laboratories and the receipt of Rs 345.7 crore from Celgene, pursuant to a settlement agreement.  

Revenues from global generics increased 7 per cent to Rs 3,281.6 crore, and rose 18 per cent to Rs 710.7 crore from pharmaceutical services and active ingredients (PSAI) division. Sales from the proprietary products division have seen a near fivefold increase at Rs 808.6 crore.

DRL said price erosion and lower volumes, besides the impact of voluntary recall of ranitidine and temporary disruption in supplies due to logistics issues, resulted in a flath growth in formulations revenues (Rs 1,426.5 crore) in the US, despite the launch of eight products during the quarter. 

Overall growth in global generics business was led by India and emerging markets, which saw a 9 and 10 percent growth at Rs 751.1 crore and Rs 827.6 crore, respectively.

During Q2, the company’s gross profit margin has increased by 250 basis points at 57.5 per cent, as against Rs 55 per cent in the year-ago period. However, adjusted for one-offs, normalised gross profit margin stood at 51.5 percent, according to the company.