Supply glitch pulls down GSK Pharma profit 8%

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GlaxoSmithKline Pharmaceuticals today reported a fall of 7.73 per cent in net profit at Rs 285.43 crore for the third quarter (ended September) of the current financial year against Rs 309.33 crore for the same quarter last year.

The decline in Q3 profit this year was owing to temporory shortage of product supply from third-party manufacturers.

The drug major's total sales during the quarter slipped 2.54 per cent to Rs 432.79 from Rs 443.15 crore last year.

The pharma company, which logged over 13 per cent growth in sales for the first six months of 2006-07, saw only 9 per cent sales growth in the third quarter owing to supply problems.

During the third quarter, one of its third-party manufacturers had to shift its base because of fire and other technical reasons, which caused delay in product delivery.

However, the supply has been restored fully now, and the sales in the last quarter are expected to see good growth, said sources.

GSK Pharma also divested its animal health business in the third quarter of the year.

It sold the division as a going concern to Virbac Animal Health India for a total consideration of Rs 207.10 crore. Accordingly, the figures for the prior period are not comparable. Animal health business formed part of the company's other businesses segment.