ICICI Direct: Sun Pharma’s U.S. Arm Taro’s Revenue Declines In Q1 But Margins Improve
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ICICI Direct Report
Sun Pharmaceuticals Ltd.’s revenues de-grew 9.4% YoY to Rs 7585 crore (our estimate Rs 7948 crore) mainly due to 27.5% YoY decline in U.S. formulations to Rs 2136 crore due to high base and continued pressure on dermatology segment (Taro included).
India business grew 3.2% YoY to Rs 2388 crore whereas emerging markets business de-grew 2.4% YoY to Rs 1316 crore.
Rest of world markets business also degrew 11.1% YoY to Rs 1030 crore. Ebitda margins expanded 47 basis points YoY, 765 basis points QoQ to 24.3% (our estimate 17.0%) despite higher employee expenses mainly due to lower other expenditure and better gross margins.
Ebitda de-grew 7.6% YoY to Rs 1844 crore (our estimate Rs 1351 crore). Adjusted profit after tax de-grew 17.4% YoY to Rs 1146 crore (our estimate Rs 621 crore).
Exceptional expense of Rs 3633 crore pertain to Taro's settlement with U.S. Department of Justice (cumulative $419 million) and $60 million provision for multi-jurisdiction antitrust matters.
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