GlaxoSmithKline Pharma posts net loss of Rs 661.16 cr for Dec quarter

Drug firm GlaxoSmithKline Pharmaceuticals on Monday reported a consolidated net loss of Rs 661.16 crore for the December 2019 quarter, mainly on account of financial impact related to the voluntary recall of Zinetac.

The company had posted a net profit of Rs 113.67 crore for the corresponding period of the previous financial year, GlaxoSmithKline Pharmaceuticals said in a filing to the BSE.

Following the recent decision to initiate a global voluntary recall of ranitidine products including Zinetac in India, the Ultimate Holding Company is continuing with investigations into the potential source of the NDMA and has initiated a comprehensive strategic review of the impact of this recall on all related assets in India, GlaxoSmithKline Pharmaceuticals said.

As part of the ongoing strategic review, during the quarter, the holding company has recognised financial impairment of Rs 640.31 crore connected to the under-utilisation of its manufacturing facilities and Rs 96.59 crore on account of other related assets/ cost, it added.

Also, charge of Rs 17 crore is recognised by Biddle Sawyer Ltd (subsidiary) on account of outstanding litigation matter, the company said.

As part of this strategic review, GSK India will explore future options for the Vemgal facility including a potential sale of the site, it added.

The company's consolidated revenue from operations stood at Rs 778.59 crore for the quarter under consideration. It was Rs 825.35 crore for the same period a year ago.

"Our global innovation, performance and trust (IPT) strategy underpinned by our culture has guided investment of our resources in focus therapies which is continuing to show encouraging results with our promoted brands recording 11 per cent growth for the quarter," GlaxoSmithKline Pharmaceuticals Managing Director A Vaidheesh said.

The results were impacted due to voluntary global recall of ranitidine products, including Zinetac, in India and trigger-based impairment charges primarily towards manufacturing facility at Vemgal, he added.

Shares of GlaxoSmithKline Pharmaceuticals closed at Rs 1,647.55 per scrip on BSE, up 0.59 per cent from its previous close.