Lupin slips as Q3 net loss widens to Rs 835 cr

Pharma major Lupin fell 0.26% to close at Rs 720.50 after consolidated net loss stood at Rs 835 crore in Q3 December 2019 (Q3 FY20), higher than net loss of Rs 151.75 crore reported in Q3 December 2018 (Q3 FY19).

Total revenue from operations declined 4.51% year-on-year (Y-o-Y) to Rs 3,769.27 crore in Q3 FY20. The Q3 earnings were disclosed during market hours today, 6 February 2020.

Consolidated pre-tax loss stood at Rs 106.82 crore in Q3 FY20 compared with pre-tax profit of Rs 83.40 crore reported in Q3 FY19. Total tax expenses jumped 212.55% to Rs 767.02 crore during the period under review.

EBITDA slipped 27.6% to Rs 522.70 crore YoY. The EBITDA margin stood at 14.1% in Q3 FY20 as against 18.9% in Q3 FY19.

Exceptional losses for the quarter stood at Rs 288.68 crore which were less than Rs 342.22 crore in exceptional losses in the same quarter last year. Losses on exceptional items pertained to impairment of Rs 1,579.77 crore related to certain acquired IPs and profit Rs 1,291 crore on divestment of the company's entire stake in Kyowa Pharmaceutical.

Commenting on the Q3 numbers, Nilesh Gupta, the managing director of Lupin, has said that, There are a lot of one-times in the numbers this quarter. The reported performance was significantly affected by exceptional events, including the impairment of the Gavis portfolio and our divestiture of Kyowa. Sequentially, the profitability in the quarter was impacted by lumpiness in some of the spend but we see improved margins hereon. The resilience of the India branded business, stabilization of the US generic base business and growth in new launches will drive growth for the Company. Quality remains our top-most priority and we are making steady progress on remediation measures across our manufacturing footprint.

During the quarter, investments in Research & Development (R&D) for the quarter stood at Rs 427.70 crore (or 11.5% of sales). India formulation sales stood at Rs 1,296.90 crore in Q3 December 2019 as compared to sales of Rs 1,341.90 crore during in Q2 September 2019 and Rs 1,190.20 crore during in Q3 December 2018; accounting for 35% of Lupin's global sales.

North America sales were Rs 1,376.60 crore in Q3 December 2019 compared to sales of Rs 1,324.40 crore during in Q2 September 2019 and Rs 1,470.40 crore during in Q3 December 2018; accounting for 37% of Lupin's global sales.

Lupin is engaged in producing, developing and marketing a range of branded and generic formulations, biotechnology products and active pharmaceutical ingredients (APIs) across the world. The firm offers products in the cardiovascular, diabetology, asthma, pediatrics, central nervous system, gastro-intestinal, anti-infectives and non-steroidal anti-inflammatory drug therapy areas.

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