US generics mart boosts Ranbaxy net profit 167%

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Ranbaxy Laboratories, the country's largest pharmaceuticals company by sales, reported a 167 per cent rise in net profit to Rs 185.9 crore for the fourth quarter ended December 2006 as against Rs 69.6 crore during the same period last year.

The increase came on the back of strong sales of generics in the key US market and a significant foreign exchange gain of Rs 46 crore during the quarter as compared with a foreign exchange loss of Rs 19 crore in the corresponding quarter last year.

The company has forecast a 15 per cent increase in sales in 2007.

Net sales increased by 22.3 per cent to Rs 1,697.5 crore for the quarter under review, up from Rs 1,387.7 crore in the same period last year. However, the results seemed to have had little impact on the Ranbaxy scrip, which closed at Rs 430.20 on the BSE, slightly lower than yesterday's close of Rs 431.5.

For the full year (Jan-Dec 2006), net profit went up to Rs 520.4 crore, a 97 per cent increase as compared with Rs 264.2 crore for 2005. Net sales increased by 18 per cent to Rs 6,021.6 crore in the year, up from Rs 5,101.9 crore a year ago.

Higher revenues from the United States and Brazil, Russia, India and the CIS countries (BRICS) markets and factors such as less excise duty burden, contributed to a spurt in the net profit.

Commenting on the annual results, Malvinder Singh, CEO and managing director, Ranbaxy, said: "We have had an extremely good year with robust sales across markets of the US, BRICS, Africa, Latin America, Middle East and the Asia Pacific. Revenues from expanded market reach, new product flow and acquisitions have kicked in. We expect to maintain the same growth rate during 2007 also," he added.

For the quarter under review, consolidated global sales went up to Rs 1,714.5 crore, an increase of 25 per cent over the previous year.

Sales in the BRICS markets stood at Rs 6,16.5 crore, up by 45 per cent as compared with the previous quarter. The international business segment contributed 82 per cent of the total sales for the company.

For the full year 2006, the North American and the BRICS markets accounted for 65 per cent of sales at approximately Rs 3,910 crore, a 25 per cent increase as compared with the previous year. The international business, to the tune of approximately Rs 4,770 crore, accounted for 79 per cent of the total sales for the year.

However, the company recorded a decline in its profits in the key European markets and China during the year.

The sales declined by 11 per cent and dipped to Rs 598.5 crore in the three key European countries "" UK, France and Germany. Sales went down by 10 per cent to Rs 58.5 crore in China during the year.