Sun Pharmaceuticals
Industries Limited
NSE Symbol SUNPHARMA
Sun pharma has announced good results for Q4 and FY 2011 (Consolidated).
Net Sales in Q4 is Rs.1463.28 cr – down by 8.61 from Q3; up by 6.8% from Q2 and up by 4.54% from Q1 FY 11; On an annualized basis (Q4 x 4 vs FY 11), Q4 sales is more than FY 11 sales (5721.43 cr) by 2.3% .FY 11 sales are than FY 10 sales by 39.45%.
Total Expenditure in Q4 FY 11 is Rs.1067.87 cr – down by 13.95% from Q3; up by 13.82% from Q2; and up by 29.61% from Q1. The Q4 expenditure, on annualized basis, is higher than FY 11 by 7.91%. FY 11 expenditure is higher than FY 10 by 36.81%.
Profit from Operations in Q4 FY 11 is Rs.395.41 cr – up by 9.82% from Q3; down by 8.44% from Q2 and down by 31.33% from Q1 FY 11; On annualized basis, Q4 OPT is lower than FY 11 by 10.29%. FY 11 OPT is higher than FY 10 by 45.77%.
Profit before tax for Q4 FY 11 is Rs.506.18 cr – up by 21.08% from Q2; down by 3.44% from Q2; and down by 13.82% from Q1. On annualized basis, Q4 FY 11 is lower than FY 11 by 0.54%. But, FY 11 is higher than FY 10 by 43.89%.
Net Profit for Q4 FY 11 is Rs.503.94 cr – up by 38.6% from Q3; down by 0.61% from Q2; and down by 12.76% from Q1; On annualized basis, Q4 NPT is higher than FY 11 by 5.68%. FY 11 NPT is higher than FY 10 by 41.6%.
Consolidated Net Profit for Q4 FY 11 is Rs.442.75 cr – up by 26.45% from Q3; down by 12.09% from Q2 and down by 21.54% from Q1 FY 11; On annualized basis, the Q4 CNPT is lower than FY 11 CNPT by 2.48% . FY 11 C-NPT is higher than FY 10 by 34.42%.
From Q3 onwards, Face value of share has come down from Rs.5 to Rs.1. The Basic EPS is Rs.4.3 in Q4; Rs.3.4 in Q3 ; Rs.24.3 / 5 = 4.86 in Q2; Rs.27.2/5 = 5.44 in Q1; Overall , EPS for FY 11 is Rs.17.5 against Rs.65.2 / 5 = 13.04 in FY 10.
Thus, while Q4 FY 11 performance is Slightly below par compared to previous 3 qtrs, FY 11 as a whole is better than FY10 significantly. Below are further numbers furnished by the company:
Highlights of Q4 FY11 consolidated financials
• Net sales from operations at Rs. 1463 crores, growing 35% over Q4 FY10
• India branded generic sale at Rs. 589 crores, registering a growth of 20% over same quarter last year
• Taro sales at $ 107.7 million, a growth of 21% over same quarter last year
• EBITDA at Rs. 444 crores, resulting into a margin of 30%
• Net profit at Rs. 443 crores, resulting into a net margin of 30%.
Highlights of FY11 consolidated financials
• Net sales from operations at Rs. 5721 crores, growing 43% over FY10
• India branded generic sale at Rs 2380 crores, registering a growth of 37% over same period last year
• EBITDA at Rs 1967 crores, resulting into operating margin of 34%
• Net profit at Rs. 1816 crores, resulting into a net margin of 32%
Strong growth in sales is primarily on account of Taro financials that have been consolidated for a little over 6 months in FY11 financials though not included in corresponding periods of the previous year. These full year financials also include significant components of non-recurring sales and profits contributed by a few products sold in the first half of FY11.
According to Dilip Shanghvi, CMD of the Company, “Performance in 2010-11 has been in-line with our expectations. Our growth rate in India continues to be ahead of the market, with strong positions in key chronic therapy areas. Taro acquisition has enhanced our presence in the US market, a key objective of our long term strategy, even as we continue to file new products on our own and evaluate further acquisition opportunities. Our long term joint venture with MSD for the Emerging Markets underscores the strategic importance of these markets for our business. Clearly, this has been an year of important strategic milestones for our international business, which now contributes over 60% of our sales. It will enable us to participate meaningfully in the fast growing global generic market.”
India Branded Prescription Products – Strong growth
Sales of branded prescription formulations in India were at Rs. 589 crores for the fourth quarter, a growth of 20% over the same quarter last year, and accounting for 40% of total sales. For FY11, India formulation sales were at Rs. 2380 crores, a growth of 37% over FY10. This high growth in FY11 is partly attributable to a lower base in the first half of FY10. On a like-to-like basis, growth in FY11 is around 23%. Based on data compiled by AWACS, Sun Pharma has grown by 21% in FY11 and has a market share of 4.3%.
AWACS estimates Indian Pharma market growth at 15% in FY11.
9 key products were launched during the quarter, taking the total to 39 for FY11. Overall, the company is ranked no. 1 based on share of prescriptions with 6 classes of specialists: psychiatrists, neurologists, cardiologists, ophthalmologists, orthopedics and gastroenterologists.
Taro
Taro financials for the quarter are consolidated into Sun Pharma financials. Taro recently announced its unaudited financials for the Jan-Mar quarter. Net sales for Jan-Mar quarter is at $ 107.7 million, a growth of 21% over same period last year, while the net profit for the quarter is at $ 25.7 million, higher by 199 % when compared to the same quarter last year. Earlier in March 2011, Taro announced its audited financials for CY2009.
In April 2011, USFDA informed Taro that after a February 2011 re-inspection of its Canadian manufacturing facility, the site has an acceptable regulatory status. Therefore, the issues noted in the February 5, 2009 warning letter were considered to be resolved.
Caraco
Caraco has convened a shareholder meeting on June 14, 2011 to approve the merger with Sun Pharma subsidiary.
Remediation efforts at the Caraco facility in Detroit and the Sun Pharma Industries., Inc facility in New Jersey are ongoing.
JV with MSD
Recently, after the close of FY11, Sun Pharma and MSD announced the creation of a joint venture to develop, manufacture and commercialize new combinations and formulations of innovative, branded generics that bring together combinations of medicines using platform delivery technologies designed to enhance convenience for patients in the Emerging Markets.
Research – Creating a pipeline
In the Jan-Mar quarter, ANDAs for 8 products have been filed by Sun Pharma. With this, in FY11, ANDAs for a total of 25 products have been filed by Sun Pharma. During this quarter, ANDAs for 2 products from Sun Pharma have been approved taking the total approvals to 14 in FY11. In addition, Taro received approval for 3 in Jan-Mar quarter. Counting all of these and 5 filed ANDAs withdrawn during the year, cumulatively ANDAs for 377 products have been filed across Sun Pharma and Taro, of which 225 have been approved by the USFDA as on March 31, 2011. Of the balance 152 awaiting approval, 20 have tentative approvals.
Consolidated R&D expense for Q4 FY11 is Rs 98 crores, or 6.7% of income from operations. For FY11, the consolidated R&D expense is Rs. 331 crores, or 5.8% of income from operations.
Strengthening the API pipeline, a cumulative of 207 DMF / CEP applications have been made, with 127 approved so far. The total number of patent applications submitted now stands at 549 with 248 patents granted so far.
Both of these now include Taro numbers as well.
RESULTS TABLE :
| SUN PHARMA – figures in lakhs | Q4 FY 11 CS | |||||
| Net Sales | 146328 | 160107 | 137007 | 139970 | 572143 | 410277 |
| Increase in SIT/WIP | -28793 | 807 | 5322 | -7435 | -30099 | -3244 |
| Raw Materials | 56159 | 37420 | 28002 | 36919 | 158500 | 99323 |
| Traded goods | 3953 | 5012 | 4620 | 4083 | 17668 | 13704 |
| Employees Cost | 25401 | 27537 | 14558 | 12461 | 79956 | 48221 |
| Depreciation | 4821 | 8047 | 3518 | 4020 | 20406 | 15331 |
| Other Expenditure | 45246 | 45278 | 37801 | 32345 | 149402 | 115992 |
| Total Expenditure | 106787 | 124101 | 93821 | 82393 | 395833 | 289327 |
| Profit from Operations | 39541 | 36006 | 43186 | 57577 | 176310 | 120950 |
| Other Income | 6593 | 2579 | 5559 | -876 | 13855 | 9145 |
| Interest | -4484 | -3222 | -3678 | -2032 | -13416 | -11389 |
| Profit before tax | 50618 | 41807 | 52423 | 58733 | 203581 | 141484 |
| Tax Expense | 224 | 5448 | 1721 | 970 | 12844 | 6786 |
| Net Profit | 50394 | 36359 | 50702 | 57763 | 190737 | 134698 |
| Minority Interest | 6119 | 1344 | 337 | 1331 | 9131 | -410 |
| Consolidated Net Profit | 44275 | 35015 | 50365 | 56432 | 181606 | 135108 |
| Face Value (in Rs.) | 1 | 1 | 5 | 5 | 1 | 5 |
| Paid-up Equity | 10356 | 10356 | 10356 | 10356 | 10356 | 10356 |
| Reserves | - | - | - | - | 937976 | 772535 |
| Basic EPS in Rs.) | 4.3 | 3.4 | 24.3 | 27.2 | 17.5 | 65.2 |
| Public Holding (%) | 36.28 | 36.29 | 36.28 | 36.28 | 36.28 | 36.28 |
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