|
GlaxoSmithKline Pharmaceuticals posted another disappointing quarter, with decline in sales and sharp fall in margins during the quarter. The Company Standalone Sales declined by 7% YoY in Q3'CY13 to Rs 626.65 crore. The sales growth was impacted due to the introduction of revamped Price Control order, extending coverage to National List of Essential Medicines (NLEM). Sales were also impacted as a segment of the trade was not buying the Company's products and this coupled with Supply constraints during the quarter.
Notably, The Operating Profit margins went down by sharp 1230 bps YoY to 18.2% and accordingly Operating profit fell by sharp 45% YoY to Rs 114.06 crore. After the lower other income (-4%), with marginal increase in depreciation (2%) and after meager EO losses, lower effective tax rate (down by 80 bps YoY to 31.7%) PAT was down by 34% YoY to Rs 100.95 crore.
- Sales down – Impacted by new NLEM Pricing Policy, and trade related issues:
The Sales declined by 7% YoY to Rs 626.65 crore for the quarter ended September 2013. The sales growth was impacted due to the introduction of revamped Price Control order, extending coverage to National List of Essential Medicines (NLEM). Also, impacted by a segment of the trade were not busying the Company's products coupled with Supply constraints during the quarter.
- Sharp fall in Margins – EBIDTA down by 38%:
The margins went down by whopping 1230 bps YoY to 18.2% on the back of sharp rise in consumption cost (up by 650 bps), other expenses (430 bps) coupled with increase in staff cost (up by 270 bps) as percentage to sales and net of stock adjustments. Eventually, Operating Profit was down by sharp 45% YoY to Rs 114.06 crore. After the 4% fall in other income to Rs 39.37 crore, EBIDTA was down by 38% YoY to Rs 153.43 crore.
- Meager EO loss in Q3, Lower tax rate - PAT down by 34%:
With the no interest cost and after the marginal 2% increase in depreciation to Rs 4.96 crore, PBT before EO was down by 39% YoY to Rs 148.47 crore. After adjusting for meager EO loss Rs 0.77 crore (down by 95%), PBT was down by 34% YoY to Rs 147.70 crore. Even after the fall in effective tax rate (down by 80 bps YoY to 31.7%) PAT was down by same 34% YoY to Rs 100.95 crore.
Standalone Nine Months Performance:
The Sales decline by 3% YoY to Rs 1908.90 crore for the nine months ended September 2013. Also, margins fell by 1030 bps YoY to 21.2% and after this Operating Profit fell by sharp 35% YoY to Rs 403.84 crore. After the 1% decline in other income to Rs 153.18 crore, EBIDTA fall was 28% YoY to Rs 557.02 crore. With no interest cost and after the marginal 6% rise in deprecation to Rs 14.11 crore, PBT before EO was down by 29% YoY to Rs 542.91 crore. After adjusting for EO gain Rs 17.74 crore (as against EO loss Rs 118.53 crore), PBT fall was restricted to 13% YoY to Rs 560.55 crore. With the marginal decline in effective tax rate (down by 30 bps YoY to 31.3%), PAT fell by 12% YoY to Rs 385 crore.
Other Information:
- The scrip was hovering at Rs 2470 at BSE, India on 13th November 2013.
|