Ahmedabad-based animal and poultry vaccine maker Hester Biosciences Limited has posted a 10.42 per cent dip in its consolidated profit before tax (PBT) at Rs 14.95 crore for the third quarter ended December 31, 2019. As against this, the company had seen a consolidated PBT of Rs 16.69 crore in Q3 of previous fiscal 2018-19.
The company's consolidated total revenue grew by 10.87 per cent to Rs 50.99 in Q3 of FY'20 as compared to Rs 45.99 crore in Q3 of FY'19.
While the trade business grew by 43 per cent in Q3 and 29 per cent in nine months, purchases by various state governments have got delayed, Rajiv Gandhi, CEO & Managing Director of Hester Biosciences Limited, in the animal healthcare division, said.
Moreover, he added that though the Indian poultry industry has come out of the crisis due to earlier high prices of maize, the recovery has been slow, thereby continuing to push the sales down of our poultry healthcare division. "We hope to see a major boost in sales in the poultry healthcare division and are confident of having good sales through tenders supplies in the animal healthcare division in Q4," he added.
To address the market conditions, the company has temporarily changed the product mix with sales being derived from fast moving products rather than high margin products. This, however, impacted Hester Biosciences' gross margin. "We have already started rolling back to a more profitable product mix with our original forecasts. This would be evident in the coming quarters," Gandhi stated.
With the company strengthening its marketing team, thereby adding to its personnel costs amidst lower sales, Hester Biosciences expects the results to be seen in the coming quarters.
"In the next financial year, we hope to see an upward spiral growth in sales with this bigger team. Due to the current market conditions, we have extended our credit cycle which has temporarily impacted our finance cost. We hope to restore the credit cycles by the financial year end," Gandhi added.