Sun Pharma Q3 net profit down 7%

Sun Pharma's branded generic drug sales in India rose to Rs 1,150 cr from the same quarter a year ago

India’s largest drug manufacturer Sun Pharmaceuticals posted a nearly seven per cent decline in its net profit in to Rs 1,425.07 crore in the third quarter of 2014-15 from Rs 1,531.09 crore in the comparable period a year ago.

Net sales remained almost flat at Rs 4,279.54 crore against Rs 4,286.59 crore in the same quarter of 2013-14.

Earnings before interest, taxes, depreciation and amortisation (Ebitda) at Rs 1,913 crore shrunk three per cent, lowering the Ebitda margin to 45 per cent from 46 per cent in the same quarter of the prior year.

Sales in the US were $413 million, down five per cent, accounting for 59 per cent of total sales for Sun Pharmaceuticals. According to the Mumbai-based company, US sales during the quarter were affected by supply constraints arising from remediation efforts.

Commenting on the results, Dilip Shanghvi, managing director of Sun Pharmaceuticals, said, “Our performance reflects our ability to maintain strong profitability despite temporary supply constraints resulting from compliance efforts. We are maintaining our 2014-15 sales forecast.”

The company’s branded generic drug sales in India were up 21 per cent to Rs 1,150 crore from the same quarter a year ago.

Taro recently posted third quarter sales of $238 million, up 11 per cent from the same quarter of the previous year. Taro’s net profit was $143 million, up by 23 per cent from the same quarter of the prior year.

Formulation sales in international markets, excluding the US accounted for $72 million, shrinking 15 per cent from the same quarter a year ago.

Sun Pharmaceuticals recently obtained clearance from the US Federal Trade Commission for its merger with Ranbaxy. Approval for the dead by the High Court of Punjab and Haryana is pending.

Sun Pharmaceuticals and Ranbaxy will have to meet conditions set out by the Competition Commission of India and the US Federal Trade Commission. The Competition Commission has asked Sun Pharmaceuticals and Ranbaxy to divest seven drug assets in India. The Federal Trade Commission had asked Ranbaxy to divest one drug in the US market and sell it to the Gujarat-based Torrent Pharmaceuticals.