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Quarter IV and Annual Results, FY2017

Proposed Dividend 375%
Sales up 24.4%, EBITDA up 18.8% and Net profits up 13.1%

Mumbai, May 24, 2017: Pharma Major Lupin Limited reported its financial performance for the fourth quarter and fiscal year ending March 31st, 2017. These audited results were taken on record by the Board of Directors at a meeting held in Mumbai today.

Key Financial & Performance Highlights

 

 Net Sales for FY2017 increased by 24.4% to Rs. 171,198 m. compared to Rs. 137,579 m. in FY2016

    • Net sales for the quarter increased by 1.3% to Rs. 41,619 m. compared to Rs. 41,090 m. in Q4 FY2016
    • Net Sales in Q4 FY2017 decreased by 5.5% sequentially compared to Rs. 44,049 m. in Q3 FY2017
  • Earnings before Interest, Tax, Depreciation and Amortization (EBITDA) for FY2017 increased by 18.8% to Rs. 45,997 m. compared to Rs. 38,705 m. in FY2016
    • EBITDA for the quarter was Rs. 8,267 m. compared to Rs. 13,497 m. in Q4 FY2016
    • EBITDA in Q4 FY2017 decreased by 37.5% sequentially compared to Rs. 13,219 m. in Q3 FY2017

 

  • Net profit increased by 13.1% to Rs. 25,575 m. compared to Rs. 22,607 m. in FY2016
    • Net profit for the quarter was Rs. 3,802 m. compared to Rs. 7,479 m. in Q4 FY2016
    • Net profit in Q4 FY2017 decreased by 39.9% sequentially compared to Rs. 6,331 m. in Q3 FY2017

 

  • Investment in Research for the year was Rs. 23,101 m., 13.5% of sales
    • Investment in Research for the quarter was Rs. 6,709 m., 16.1% of sales

 

  • EBITDA includes impact of the following items:
    • During Q4 FY2017, the Company made a provision for liability towards its Australian subsidiary amounting to Rs. 1,559 m., in respect of compensation for patent litigation towards its Isabelle generic launch in Australia.
    • Net Impact of foreign exchange fluctuation on EBITDA was a loss of Rs. 1,680 m. during Q4 FY2017 compared to a gain of Rs. 267 m. during Q4 FY2016 and a gain of Rs. 276 m. during Q3 FY2017

Commenting on the results, Mr. Nilesh Gupta, Managing Director, Lupin Limited, said “We have had a stellar year with strong double-digit growth across all our regions. Steady progress on our complex generic pipeline, our impeccable record of compliance and focus on operational excellence will help sustain our growth momentum in the mid to long-term”.

Consolidated Audited financial Results – FY2017

Amount in Rs. m.

Particulars FY2017 % of sales FY2016 % of sales Growth %
Sales 171,198 100.0% 137,579 100.0% 24.4%
Other operating income 3,745 2.2% 4,976 3.6% -24.7%
Total Revenue from operations 174,943 102.2% 142,555 103.6% 22.7%
 

Material cost

50,014 29.2% 43,326 31.5% 15.4%
Gross Profit (Excl. Other operating income) 121,184 70.8% 94,253 68.5% 28.6%
 

Employee cost

28,495 16.6% 21,416 15.6% 33.1%
Manufacturing & Other expenses 51,502[1] 30.1% 40,960 29.8% 25.7%
Operating Profit 44,932 26.2% 36,853 26.8% 21.9%
 

Other Income

1,065 0.6% 1,852 1.3% -42.5%
EBITDA 45,997 26.9% 38,705 28.1% 18.8%
 

Depreciation & Amortization

9,122 5.3% 4,871 3.5% 87.3%
EBIT 36,875 21.5% 33,834 24.6% 9.0%
 

Finance cost

1,525 0.9% 595 0.4% 156.3%
PBT 35,350 20.6% 33,239 24.2% 6.3%
 

Tax

9,785 5.7% 10,593 7.7% -7.6%
Share of Profit from Jointly controlled entity 82 0.0% 49 0.0%  
Non-Controlling Interest 72 0.0% 88 0.1%  
Net Profit 25,575 14.9% 22,607 16.4% 13.1%

 

[1] The Company made a provision for liability towards its Australian subsidiary amounting to Rs. 1,559 m., in respect of compensation for patent litigation towards its Isabelle generic launch in Australia.

Consolidated Audited financial Results – Quarter IV, FY2017

Amount in Rs. m.

Particulars Q4 FY2017 % of sales Q4 FY2016 % of sales YoY Growth % Q3 FY2017 % of sales QoQ Growth %
Sales 41,619 100.0% 41,090 100.0% 1.3% 44,049 100.0% -5.5%
Other operating income 914 2.2% 884 2.2% 3.4% 780 1.8% 17.2%
Total Revenue from operations 42,533 102.2% 41,974 102.2% 1.3% 44,829 101.8% -5.1%
                 
Material cost 11,851 28.5% 11,010 26.8% 7.6% 13,016 29.5% -9.0%
Gross Profit (Excl. Other operating income) 29,768 71.5% 30,080 73.2% -1.0% 31,033 70.5% -4.1%
                 
Employee cost 7,077 17.0% 5,681 13.8% 24.6% 7,287 16.5% -2.9%
Manufacturing & Other expenses 15,791[2] 37.9% 12,135 29.5% 30.1% 12,343 28.0% 27.9%
Operating Profit 7,814 18.8% 13,148 32.0% -40.6% 12,183 27.7% -35.9%
                 
Other Income 453 1.1% 349 0.8% 29.8% 1,036 2.4% -56.3%
EBITDA 8,267 19.9% 13,497 32.8% -38.7% 13,219 30.0% -37.5%
                 
Depreciation & Amortization 2,674 6.4% 1,488 3.6% 79.7% 2,309 5.2% 15.8%
EBIT 5,593 13.4% 12,009 29.2% -53.4% 10,910 24.8% -48.7%
                 
Finance cost 406 1.0% 310 0.8% 31.0% 484 1.1% -16.1%
PBT 5,187 12.5% 11,699 28.5% -55.7% 10,426 23.7% -50.2%
                 
Tax 1,367 3.3% 4,188 10.2% -67.4% 4,095 9.3% -66.6%
Share of Profit from Joint Controlled entity 16 0.0% 19 0.0%   24 0.1%  
Non-Controlling Interest 34 0.1% 51 0.1%   24 0.1%  
Net Profit 3,802 9.1% 7,479 18.2% -49.2% 6,331 14.4% -39.9%

 

[2] The Company made a provision for liability towards its Australian subsidiary amounting to Rs. 1,559 m., in respect of compensation for patent litigation towards its Isabelle generic launch in Australia.

Income Statement highlights – Q4 FY2017

  • Material cost increased by 170 bp to 28.5% of sales, at Rs. 11,851 m. compared to Rs. 11,010 m. in Q4 FY2016
  • Personnel cost increased by 320 bp to 17.0% of sales, at Rs. 7,077 m. compared to Rs. 5,681 m. in Q4 FY2016
  • Manufacturing and other expenses increased by 840 bp to 37.9% of sales at Rs. 15,791 m. compared to Rs. 12,135 m. in Q4 FY2016
  • Investment in Research for the quarter was Rs. 6,709 m. representing 16.1% of sales
  • Net Impact of foreign exchange fluctuation on EBITDA was a loss of Rs. 1,680 m. during Q4 FY2017 as compared to a gain of Rs. 267 m. during Q4 FY2016 and a gain of Rs. 276 m. during Q3 FY2017

Balance Sheet highlights

  • Operating working capital decreased to Rs. 48,960 m. as on March 31st, 2017 compared to Rs. 49,691 m. as on December 31st, 2016. The working capital number of days stands at 105 days as on March 31st, 2017 compared to 105 days as on December 31st, 2016
  • Capital Expenditure for the year was Rs. 16,634 m.
  • Net Debt-Equity ratio for the company stands at 0.38:1

 

Sales Mix

 

Particulars FY2017 FY2016 YoY growth %
Formulations 159,815 125,110 27.7%
North America 82,627 59,249 39.5%
India 38,157 34,486 10.6%
APAC 22,655 17,705 28.0%
EMEA 10,115 8,676 16.6%
LATAM 4,519 3,507 28.9%
ROW 1,742 1,487 17.1%
 
API 11,383 12,469 -8.7%
Total 171,198 137,579

 

Particulars Q4 FY2017 Q4 FY2016 YoY growth % Q3 FY2017 QoQ growth %
Formulations 38,804 38,137 1.7% 41,365 -6.2%
North America 19,007 21,901 -13.2% 21,755 -12.6%
India 8,788 7,722 13.8% 9,912 -11.3%
APAC 6,118 4,532 35.0% 5,601 9.2%
EMEA 3,012 2,452 22.8% 2,555 17.9%
LATAM 1,269 924 37.3% 1,175 8.0%
ROW 610 606 0.7% 367 66.2%
 
API 2,815 2,953 -4.7% 2,684 4.9%
Total 41,619 41,090 1.3% 44,049 -5.5%

 

 

Operational Highlights

North America

Lupin’s North America FY2017 sales increased by 39.5% to Rs. 82,627 m. compared to FY2016; accounting for 48% of Lupin’s global sales. Q4 FY2017 sales were Rs. 19,007 m. compared to Rs. 21,901 m. during Q4 FY2016 and Rs. 21,755 m. during Q3 FY2017.

 

  • FY2017 sales increased by 36.5% to USD 1,207 m. compared to FY2016. US sales were USD 276 m. during Q4 FY2017 compared to USD 325 m. during Q4 FY2016 and USD 316 m. during Q3 FY2017.
  • The Company launched 9 products in the US market during the quarter. The Company now has 139 products in the US generics market.
  • Lupin is now the market leader in 45 products in the US generics market and amongst the Top 3 in 83 of its products (market share by prescriptions, IMS Health, March 2017).

 

India

Lupin’s India formulation FY2017 sales increased by 10.6% to Rs. 38,157 m. compared to FY2016; accounting for 22% of Lupin’s global sales. Q4 FY2017 sales increased by 13.8% to Rs. 8,788 m. compared to Rs. 7,722 m. India Formulation business decreased by 11.3% sequentially compared to Rs. 9,912 m. during Q3 FY2017.

Asia-Pacific (APAC)

Lupin’s APAC FY2017 sales increased by 28.0% to Rs. 22,655 m. compared to FY2016; accounting for 13% of Lupin’s global sales. Q4 FY2017 sales increased by 35.0% to Rs. 6,118 m. compared to Rs. 4,532 m. during Q4 FY2016.  APAC sales grew by 9.2% sequentially compared to Rs. 5,601 m. during Q3 FY2017.

Lupin’s Japan FY2017 sales increased by 14.7% to JPY 28,756 m. compared to FY2016. Q4 FY2017 sales increased by 34.0% to JPY 7,944 m. compared to JPY 5,929 m. during Q4 FY2016 and increased by 9.7% sequentially compared to JPY 7,244 m. during Q3 FY2017.

Lupin’s Philippines FY2017 sales increased by 22.6% to PHP 1,969 m. compared to FY2016. Q4 FY2017 sales increased by 35.5% to PHP 615 m. compared to PHP 454 m. during Q4 FY2016 and increased by 54.2% sequentially compared to PHP 399 m. during Q3 FY2017.

Europe, Middle-East and Africa (EMEA)

Lupin’s EMEA FY2017 sales increased by 16.6% to Rs. 10,115 m. compared to FY2016; accounting for 6% of Lupin’s global sales. Q4 FY2017 sales increased by 22.8% to Rs. 3,012 m. compared to Rs. 2,452 m. during Q4 FY2016. EMEA sales increased by 17.9% sequentially as compared to Rs. 2,555 m. during Q3 FY2017.

Lupin’s South Africa FY2017 sales increased by 21.1% to ZAR 1,012 m. compared to FY2016. Q4 FY2017 sales increased by 26.0% to ZAR 325 m. compared to ZAR 258 m. during Q4 FY2016 and increased by 41.3% sequentially compared to ZAR 230 m. during Q3 FY2017. Lupin remains the 4th largest generic player in the South African market.

Lupin’s Germany FY2017 sales increased by 24.4% to Euro 26 m. compared to FY2016. Q4 FY2017 sales were Euro 6.5 m. compared to Euro 7.2 m. during Q4 FY2016 and Q3 FY2017.

Latin America (LATAM)

Lupin’s LATAM FY2017 sales increased 28.9% to Rs. 4,519 m. compared to FY2016; accounting for 3% of Lupin’s global sales. Q4 FY2017 sales increased by 37.3% to Rs. 1,269 m. compared to Rs. 924 m. during Q4 FY2016.  LATAM sales increased by 8.0% sequentially compared to Rs. 1,175 m. during Q3 FY2017.

Lupin’s Brazil FY2017 sales increased by 52.9% to BRL 126 m. compared to FY2016. Q4 FY2017 sales increased by 28.5% to BRL 35 m. compared to BRL 27 m. during Q4 FY2016 and increased by 18.1% sequentially compared to BRL 29 m. during Q3 FY2017.

Lupin’s Mexico FY2017 sales increased by 5.4% to MXN 530 m. compared to FY2016. Q4 FY2017 sales increased by 27.3% to MXN 148 m. compared to MXN 116 m. during Q4 FY2016 and decreased by 6.1% sequentially compared to MXN 157 m. during Q3 FY2017.

Global API

Global API sales declined by 8.7% to Rs. 11,383 m. compared to FY2016; accounting for 7% of Lupin’s global sales. Q4 FY2017 sales declined by 4.7% to Rs. 2,815 m. compared to Rs. 2,953 m. during Q4 FY2016.  Global API sales increased by 4.9% sequentially compared to Rs. 2,684 m. during Q3 FY2017.

Research and Development

Revenue Expenditure on R&D FY2017 amounted to Rs. 23,101 m., 13.5% of sales as against Rs. 16,038 m., 11.7% of net sales for FY2016. Revenue expenditure on R&D for Q4 FY2017 amounted to Rs. 6,709 m., 16.1% of sales.

Lupin filed 25 ANDAs and received 7 approvals from the US FDA during the quarter. Cumulative ANDA filings with the US FDA were 368 as of March 31st, 2017, with the company having received 214 approvals to date. The Company now has 45 First-to-Files (FTF) filings including 23 exclusive FTF opportunities. Cumulative DMF filings stands at 187 as of March 31st, 2017.

The Company received approval for 2 MAA from the European authority during the quarter. Cumulative filings with European authorities now stands at 62 with the company having received 55 approvals to date.

About Lupin Limited

Lupin is an innovation led transnational pharmaceutical company developing and delivering a wide range of branded & generic formulations, biotechnology products and APIs globally. The Company is a significant player in the Cardiovascular, Diabetology, Asthma, Pediatric, CNS, GI, Anti-Infective and NSAID space and holds global leadership position in the Anti-TB segment.

Lupin is the 4th and the 6th largest generics pharmaceutical company by market capitalization (March 31st, 2017, Bloomberg) and sales globally (December 31st, 2016, Bloomberg). The Company is the 5th largest pharmaceutical player in the US by prescriptions (4.52% market share – IMS Health, February 2017); the 2nd largest Indian pharmaceutical company by sales; the 6th largest generic pharmaceutical player in Japan and the 4th largest generic pharmaceutical company in South Africa (IMS Health, March 2017).

For the financial year ended 31st March, 2017, Lupin’s Consolidated sales and Net profit stood at Rs. 171,198 million (USD 2.55 billion) and Rs. 25,575 million (USD 381 million) respectively. Please visit http://www.lupin.com for more information.

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CIN: L24100MH1983PLC029442 Registered Office: Lupin Ltd, 3rd Floor, Kalpataru Inspire, Off Western Express Highway, Santacruz (East), Mumbai 400 055. 

For further information or queries please contact –

Arvind Bothra

Head – Investor Relations and M&A

Ph: +91-22 6640 2137

Email: arvindbothra@lupin.com

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