Biocon’s Profit Declines For Fourth Straight Quarter On Lower Biosimilar Revenue
Biocon’s net profit fell 46 percent to Rs 92 crore in the third quarter.
Biocon Ltd.’s net profit declined for the fourth straight quarter, missing analyst estimates due to higher costs and lower biosimilar revenue.
The bio-pharmaceutical manufacturer’s net profit fell 42 percent to Rs 111.6 crore as compared to the same period last year, according to an exchange filing. This was below the Bloomberg consensus estimate of Rs 109 crore. The bottom line was hit by 42 percent increase in interest and depreciation costs largely attributable to its Malaysia business, Biocon said in the press release accompanying the earnings filing. Revenue rose 2 percent to Rs 1,058 crore year-on-year.
While the branded and research services segment reported a double-digit growth during the quarter, the small molecules business continued to face headwinds from pricing pressure and channel consolidation in the U.S., Biocon said. Revenue in the biologics business declined as well. The company expects these two segments to revive early next year.
- Branded formulation segment showed an increase of 27 percent to Rs 156.1 core.
- Research services business grew 17 percent to Rs 387.7 crore.
- Small molecules business declined 9 percent to Rs 368.8 crore year-on-year.
- Biologics business was down 15 percent to Rs 189.8 crore.
Biocon obtained USFDA approval for biosimilar Trastuzumab partnered with Mylan, Chairperson and Managing Director Kiran Mazumdar Shaw said in the press release. The drugmaker also announced a tie-up this quarter with Novartis’ generics unit Sandoz that will focus on developing copies, or biosimilars, of biologic drugs in immunology and oncology.
Other Highlights
- Operating margin contracted to 21 percent from 26.6 percent in the same quarter last year on account of lower licensing Income and costs related to Malaysia operations.
- Earnings before interest, taxes, depreciation and amortisation declined 20 percent to Rs 222 crore in the same period.
Ahead of the earnings announcement, shares of the Bengaluru-based bio-pharmaceutical firm was down 1.12 percent to Rs 634.60 today.
(Corrects an earlier version that said profit fell 46 percent to Rs 92 crore this quarter)