I am privileged to present the Annual Report for the Fiscal Year2021-22. I hope this letter finds you all safe and sound.
The fiscal year 2021-22 was difficult for all of us because COVID-19turned the world topsy-turvy. New mutations of the virus continued to emerge raisingconcerns about the rate of the human toll. However on the brighter side increasedvaccine coverage allowed for a return to some normalcy in routine economic activitiesli_ing sentiments. At Balaxi Pharmaceuticals Limited we have continued to succeed on ourgrowth journey despite an uncertain global pandemic and challenging industry dynamics byadhering to our core principles of employee safety and well-being business continuityand social responsibility. Our continuous focus on strengthening our brand in each of ourmarkets and out-competing our peers through excellent product availability and servicehas aided this encouraging performance.
The management and employees worked tirelessly to deal with thedifficult circumstances. As a team we all stood firm in the face of this headwind andstorm. Our stock-and-sell model ensured the ready availability of our products. Ourability to counter supply chain and inflationary pressures smartly meant that we couldbetter deal with the vagaries of a troubled marketplace. In fact we were able to expandour consumer outreach and ready consumer acceptance for our higher prices that resultedfrom the disruptions. For us the Pandemic Crisis presented an opportunity fordifferential growth and we were able to navigate through this episode smoothly. Thisproved our resilience as a company and is the primary reason we performed well throughFY2022.
Throughout the review period we remained focused on our goal ofprotecting the health and well-being of our employees and their families increasing theglobal availability of our medications and assisting our communities relieforganisations and those on the front lines of the worldwide epidemic. In retrospect ourdedication to becoming a more agile and responsive firm was evident during this periodand it gives me confidence that we are well-positioned for the future.
Showing resilience through numbers
We delivered a strong performance in fiscal FY2022 reflectingcontinued growth in each of our markets strong profitability and record free cash flowsenhancing shareholder value.
During the fiscal year of FY2022 our revenues grew by 20.77% YoY fromRs. 231.33 crore in FY2021 to Rs. 279.38 crore.
In terms of contributions our EBITDA grew by 23.61% YoY from Rs. 44.64crore in FY2021 to Rs. 55.18 crore in FY2022. The EBIDTA margin expanded by 45 bps to19.75% in FY2022 predominantly led by a favourable product mix and various coste_iciencies. In terms of our net contribution our Profit after Tax grew by 24.96% YoYfrom Rs. 38.14 crore in FY2021 to Rs. 47.66 crore in FY2022. I am pleased to inform youthat our PAT margin expanded by 9.52 bps YoY to 17.1% in FY2022.
Adapting to a greater vision
The Company has come a long way based on an asset-light model. We havetypically outsourced our production to keep our assets light allowing us to focus more onintellectual property (IP) sales growth and expansion. We have now set our sights on astrategic transition from a player only focused on frontier markets to one that is alsoparticipating within advanced markets. To accomplish this we are gradually shi_ing ourbusiness model from being Asset Light' to being Asset Right.' To bean EU GMP certified participant we have committed to develop a manufacturing facility inHyderabad that will recognise as in-house manufacturing competence which leads us toachieve this goal. While preparing for EU-specific products and EU GMP certification thefacility will contribute by making certain value-added packaged products that are readilyin demand in our existing markets.
Our frontier strategy sharpens
I am proud to say that our frontier market strategy has demonstratedits distinctness and long-term validity as a business model that can be replicated acrossmultiple geographies. A significant growth driver for us is the consistent seeding of newgeographies while nurturing and organically growing our existing markets. We have provenour success in frontier markets in Sub-Saharan Africa. We have already entered newergeographies within Africa and Central America particularly in Honduras El SalvadorNicaragua Ecuador Zambia and the Central African Republic. We have submitted technicaldossiers to register several pharmaceutical products which will be added to our portfolioover time.
Expanding our IP portfolio
At Balaxi Pharmaceuticals Limited we take a portfolio approach to sella margin-rich blended product mix. We currently have about 607 registrations serving 30+therapeutic segments with branded generics accounting for approximately 30% of theportfolio. Furthermore as of March 31 2022 we had about 660 Registrations submitted tovarious Ministries of Health (MOH) or in the pipeline for future filings in both existingand new markets. With most new registrations going to Guatemala Honduras and ElSalvador I expect these two new markets will outsell the rest of our Latin Americanregion. I look forward to these countries significantly contributing to our growth inFY2023 and FY2024.
A positive outlook on the future
In CY2022 the global economy is showing signs of faltering due todisruptions in global oil food and commodity supplies caused by the Russia-Ukraineconflict and by the fallout from China's widespread lockdowns to contain a newcoronavirus outbreak. Global growth therefore remains fraught with uncertainty. The pathof the pandemic government policy actions the evolution of financial circumstances andcommodity prices and the economy's ability to respond to health-related impedimentswill all impact future developments.
Our culture at Balaxi Pharmaceuticals Limited on the other hand isdistinguished by shared success which is based on our commitment to making a positivedifference with our channel partners people shareholders partners and communities. Ourmarket influence formula is long-lasting as we constantly improve our business andembrace change to provide superior medicines for our customers.
Though most of our peers within our markets felt the pressure of achallenging year our commendable performance made us an outlier. To the management'scredit we could keep all of our operations running reasonably smooth during the crisis.Against this backdrop of overall decline our revenue increased by 20.77% and we couldprotect our margins.
Our vision is firmly rooted in the long term and we are unwilling tobe distracted by the pandemic's trials and tribulations. We have definite plans tobecome a formulations manufacturer serving advanced regulated markets. We are on the righttrack to delivering long-term sustainable growth because we have established the rightstrategic objectives and have the support of a strong leadership team.
I want to thank everyone for their hard work perseverance andcommitment. I would also like to thank all of our channel partners and shareholders foryour continued support and faith in Your Company as we strive to become a leading globalpharmaceuticals player.