investments200gana-894

PressReleaseDR.
REDDY'SLABORATORIESLTD.
8-2-337,RoadNo.
3,BanjaraHills,Hyderabad-500034.
Telangana,India.
CONTACTINVESTORRELATIONSMEDIARELATIONSAMITAGARWALamita@drreddys.
com(Ph:+91-40-49002135)APARNATEKURIaparnatekuri@drreddys.
com(PH:+91-40-49002446)Dr.
Reddy'sQ4&FY20FinancialResultsHyderabad,India,May20,2020:Dr.
Reddy'sLaboratoriesLtd.
(BSE:500124|NSE:DRREDDY|NYSE:RDY)todayannounceditsconsolidatedfinancialresultsforthefourthquarterandfullyearendedMarch31,2020underInternationalFinancialReportingStandards(IFRS).
*ExcludingintangiblesimpairmentofRs.
1,677Cr;AdjustedProfitbeforetaxisRs.
3,480Cr(55%growthYoY)Commentingontheresults,Co-ChairmanandMD,GVPrasadsaid"FY20hasbeenaverypositiveyearforthecompany.
ProgressmadeduringtheyearincludesVAIstatusforCTO6,healthyproductpipelinebuildup,productivityimprovement,andstrongfinancialperformanceacrossourbusinesses".
FY20PerformanceSummaryRs.
17,460CrRevenue[Up:13%YoY]53.
8%GrossMargin[FY19:54.
2%]Rs.
5,013CrSGNAexpenses[Up:3%YoY]Rs.
1,541CrR&Dexpenses[8.
8%ofRevenues]Rs.
4,643CrEBITDA[Up:36%YoY]Rs.
1,803Cr*ProfitbeforeTax[10.
3%ofRevenues]Q4PerformanceSummaryRs.
4,432CrRevenue[Up:1%QoQ;Up:10%YoY]51.
5%GrossMargin[Q3FY20:54.
1%;Q4FY19:52.
4%]Rs.
1,218CrSGNAexpenses[Down:4%QoQ,Down:1%YoY]Rs.
419CrR&Dexpenses[9.
5%ofRevenues]Rs.
1,001CrEBITDA[Down:7%QoQ;Up:14%YoY]Rs.
714CrProfitbeforeTax[16.
1%ofRevenues]2Allamountsinmillions,exceptEPSAllUSdollaramountsbasedonconveniencetranslationrateofIUSD=Rs.
75.
39Dr.
Reddy'sLaboratoriesLimitedandSubsidiariesConsolidatedIncomeStatementParticularsQ4FY20Q4FY19YoYGr%Q3FY20QoQGr%($)(Rs.
)($)(Rs.
)($)(Rs.
)Revenues58844,31853340,1661058143,8381CostofRevenues28521,51025419,1131326720,1167GrossProfit30322,80827921,053831523,722(4)OperatingExpensesSelling,General&Administrativeexpenses16212,17716312,294(1)16812,670(4)ResearchandDevelopmentexpenses564,190493,66214523,9496Impairmentofnon-currentassets07182(91)17513,200(100)Otheroperatingincome(2)(168)(4)(330)(49)(3)(228)(26)Resultsfromoperatingactivities886,602715,34524(78)(5,869)(212)Netfinanceincome(6)(435)(5)(349)25(6)(419)4Shareofprofitofequityaccountedinvestees(1)(105)(2)(157)(33)(2)(176)(40)Profitbeforeincometax957,142785,85122(70)(5,274)(235)Incometax(7)(500)201,507(133)6423(218)Profitfortheperiod1017,642584,34476(76)(5,697)(234)DilutedEarningsPerShare(EPS)0.
6146.
010.
3526.
1676(0.
46)(34.
37)(234)As%toRevenuesQ4FY20Q4FY19Q3FY20GrossProfit51.
552.
454.
1SG&A27.
530.
628.
9R&D9.
59.
19.
0EBITDA22.
622.
024.
5PBT16.
114.
6(12.
0)PAT17.
210.
8(13.
0)EBITDAComputationParticularsQ4FY20Q4FY19Q3FY20($)(Rs.
)($)(Rs.
)($)(Rs.
)ProfitbeforeIncomeTax957,142785,851(70)(5,274)Interest(income)net*(1)(100)(3)(215)(4)(274)Depreciation282,080282,136282,130Amortization128851396513955Impairment0718217513,200EBITDA13310,0131178,81914210,737*IncludesincomefromInvestments3Allamountsinmillions,exceptEPSAllUSdollaramountsbasedonconveniencetranslationrateofIUSD=Rs.
75.
39RevenueMixbySegmentParticularsQ4FY20Q4FY19YoYGrowth%Q3FY20QoQGrowth%(Rs.
)(Rs.
)(Rs.
)GlobalGenerics36,39830,3842035,9271NorthAmerica18,07214,9572115,99913Europe3,4461,912803,09311India6,8396,50557,636(10)EmergingMarkets8,0427,010159,199(13)PharmaceuticalServicesandActiveIngredients(PSAI)7,1956,76566,9064ProprietaryProducts&Others7253,017(76)1,005(28)Total44,31840,1661043,838141%8%15%18%16%2%Q4FY20SalesMixNorthAmericaEuropeIndiaEmergingMarketsPSAIProprietaryProducts&Others4Allamountsinmillions,exceptEPSAllUSdollaramountsbasedonconveniencetranslationrateofIUSD=Rs.
75.
39Dr.
Reddy'sLaboratoriesLimitedandSubsidiariesConsolidatedIncomeStatementParticularsFY20FY19Growth%($)(Rs.
Rs.
)%Revenues2,3161,74,600100.
02,0411,53,851100.
013CostofRevenues1,06980,59146.
293470,42145.
814GrossProfit1,24794,00953.
81,10783,43054.
213OperatingExpensesSelling,General&Administrativeexpenses66550,12928.
764648,68031.
63ResearchandDevelopmentexpenses20415,4108.
820715,60710.
1(1)Impairmentofnon-currentassets22216,7679.
632100.
17884Otheroperatingincome(57)(4,290)(2.
5)(26)(1,955)(1.
3)119Resultsfromoperatingactivities21215,9939.
227720,88813.
6(23)Netfinanceincome(20)(1,478)(0.
8)(15)(1,117)(0.
7)32Shareofprofitofequityaccountedinvestees(7)(561)(0.
3)(6)(438)(0.
3)28Profitbeforeincometax23918,03210.
329822,44314.
6(20)Incometax(19)(1,466)(0.
8)483,6482.
4(140)Profitfortheperiod25919,49811.
224918,79512.
24DilutedEarningsPerShare(EPS)1.
56117.
401.
50113.
094EBITDAComputationParticularsFY20FY19($)(Rs.
)($)(Rs.
)ProfitbeforeIncomeTax23918,03229822,443Interest(income)net*(11)(839)(9)(654)Depreciation1158,6401118,362Amortization513,832513,828Impairment22216,7673210EBITDA61646,43145334,189EBITDA(%torevenues)26.
622.
2*IncludesincomefromInvestmentsKeyBalanceSheetItemsParticularsAson31stMar,2020Ason31stDec2019Ason31stMar2019($)(Rs.
)($)(Rs.
)($)(Rs.
)Cashandcashequivalentsandotherinvestments34626,06827120,45733925,570Tradereceivables(current&non-current)69052,01561146,09553039,982Inventories46535,06650137,74644533,579Property,plantandequipment69452,33269952,70971754,088GoodwillandOtherIntangibleassets42031,65340930,84764048,269Loansandborrowings(current&non-current)29322,10221616,32050938,381Tradepayables22116,65923617,81019314,553Equity2,0561,54,9881,9721,48,6721,8601,40,1975Allamountsinmillions,exceptEPSAllUSdollaramountsbasedonconveniencetranslationrateofIUSD=Rs.
75.
39RevenueMixbySegment[Yearonyear]ParticularsFY20FY19Growth%($)(Rs.
Rs.
)%GlobalGenerics1,8321,38,12379.
11,6301,22,90379.
912NorthAmerica64,65959,9578Europe11,7077,87349India28,94626,17911EmergingMarkets32,81128,89414PharmaceuticalServicesandActiveIngredients(PSAI)34225,74714.
732024,14015.
77ProprietaryProducts&Others14210,7306.
1906,8084.
458Total2,3161,74,600100.
02,0411,53,851100.
01337%7%17%19%15%6%FY20SalesMixNorthAmericaEuropeIndiaEMPSAIProprietaryProducts&Others6ResponsetoCOVID-19Wearetakingalltheprotectivemeasuresintermsofensuringthehealthandsafetyofouremployeesbyfollowingthephysicaldistancenorms,usingprotectivegears,andotherappropriatemeasures.
Variousinitiativeshavebeenundertakentoensurethatourmanufacturingrelatedoperationscontinueunabatedenablingustoserveourpatients.
AfewproductsrelatedtoCOVID-19areunderdevelopment.
Weareusingdigitalchannelsforenablingworkfromhomeandreachingouttodoctors,customersandvendors.
WearealsoplayingourpartofcontributingtothesocietybyextendingsupportthroughvariousCSRinitiativessuchassupportingthehealthcareprofessionalsandotherswiththePPEkits,masks,sanitizers,glovesbesidesprovidingfoodassistancetothemarginalsections&migrantfamilies.
RevenueAnalysis[Q4andfullyearFY20]GlobalGenerics(GG)RevenuesfromGGsegmentatRs.
138.
1billionhigherby12%overFY19,onaccountofgrowthacrossallourmarkets.
Therehasbeendoubledigitgrowthinbrandedmarkets(India,Emergingmarkets)andturnaroundinourgenericsbusiness(NAG,Europe).
Q4revenueatRs.
36.
4billion,YoYgrowthof20%andQoQgrowthof1%.
TheQoQwasdrivenbyNAG&EuropepartlyoffsetbydeclineinIndia&EmergingMarkets.
NorthAmericaGenerics(NAG)RevenuesfromNorthAmericaGenericsfortheyearatRs.
64.
7billion,YoYgrowthof8%.
Theyearwasbenefitedbynewlaunches,scaleupofexistingproductsandafavorableforexrate,whichwaspartiallyoffsetbypriceerosion.
RevenuesforQ4atRs.
18.
1billion,YoYgrowthof21%andQoQgrowthof13%,supportedbycontributionfromnewproductlaunchesandincreaseinvolumesforexistingproducts.
ThevolumeswerehigherpartiallyduetoCOVID-19relatedstockingup.
Duringthisquarter,welaunched5newproducts–majoronesbeingNaproxenandEsomeprazoleMagnesiumdelayed-releasetablets(gVimovo),PyrimethamineTablets(gDaraprim)andNaloxoneHCLInjection(withCGTexclusivity).
Asof31stMarch2020,cumulatively99genericfilingsarependingforapprovalwiththeUSFDA(97ANDAsand2NDAsunder505(b)(2)route).
OutofthependingANDAs,54areParaIVs,andwebelieve30have'FirsttoFile'status.
IndiaRevenuesfromIndiafortheyearatRs.
28.
9billion.
Year-on-yeargrowthof11%,drivenbyimprovedrealizationsinbasebusiness,volumetractionandnewproductslaunchedduringtheyear.
RevenuesforQ4atRs.
6.
8billion,YoYgrowthof5%,QoQdeclineof10%.
TheQ4revenueswerepartiallyimpactedduetologisticsrelateddisruptionscausedbyCOVID-19lock-downs.
7EmergingMarkets(EM)RevenuesfromEmergingMarketsfortheyearatRs.
32.
8billion,growthof14%.
-RevenuesfromRussiafortheyearatRs.
16.
9billion,YoYgrowthof10%.
Growthwasmajorlydrivenbyincreaseinvolumesandimprovementinrealizationsforsomeofourkeymolecules.
-RevenuesfromotherCIScountriesandRomaniafortheyearatRs.
6.
5billion,YoYgrowthof23%.
Growthwasonaccountofincreaseinvolumesandnewlaunches.
-RevenuesfromRestofWorld(RoW)territoriesfortheyearatRs.
9.
4billion,YoYgrowthof13%.
Growthprimarilyonaccountofnewlaunchesandvolumetractioninkeyproducts,partiallyimpactedbypriceerosionincertainmarkets.
RevenuesforthequarterareRs.
8.
0billion,YoYgrowthof15%,QoQdeclineof13%.
-RevenuesforRussiafortheQ4atRs.
3.
9billion,YoYgrowthof8%,QoQdeclineof20%.
-RevenuesfromotherCIScountriesandRomaniaforthequarterareRs.
1.
8billion,YoYgrowthof51%,QoQdeclineof2%.
-RevenuesfromRestofWorld(RoW)territoriesforthisquarterareRs.
2.
3billion,YoYgrowthof6%,QoQdeclineof5%.
EuropeRevenuesfromEuropefortheyearatRs.
11.
7billion.
YoYgrowthof49%,primarilyonaccountofvolumetractioninbasebusinessandnewproductlaunchesacrossourmarkets,includingnewermarketsofFrance,ItalyandSpain,whichwaspartiallyoffsetbypriceerosion.
RevenuesforQ4atRs.
3.
4billion,YoYgrowthof80%andQoQgrowthof11%.
PharmaceuticalServicesandActiveIngredients(PSAI)RevenuesfromPSAIatRs.
25.
7billion.
Year-on-yeargrowthof7%largelydrivenbyincreaseinvolumesofkeyproductsofAPIbusinessandfavorableforex.
RevenuesforQ4atRs.
7.
2billion,YoYgrowthof6%andQoQgrowthof4%.
Duringtheyear,wehavefiled10DMFsintheUS.
ProprietaryProducts(PP)RevenuesfromPPfortheyearatRs.
7.
9billion,YoYgrowthof67%.
Duringtheyear,wesoldourUSandselectterritoryrightsforZEMBRACESYMTOUCH(sumatriptaninjection)3mgandTOSYMRATM(sumatriptannasalspray)10mg,ofourNeurologyfranchise.
RevenuesforQ4areRs.
2million.
8IncomeStatementHighlights:Grossprofitmarginfortheyearat53.
8%,declinedby~40bpsoverpreviousyearprimarilyonaccountofpriceerosionsintheUS,Europeandcertainemergingmarketsandregionmix.
ThedeclinewaspartiallyoffsetduetorevenuerecognizedonthesaleofrightsfortwoPPNeuroproducts.
GrossprofitmarginforGGandPSAIbusinesssegmentsareat56.
8%and24.
1%respectively.
GrossprofitmarginfortheQ4at51.
5%(GG:55.
9%,PSAI:28.
4%).
-YoYbasisthegrossmargindeclinedby~90bps,asinQ4FY19werecognizedrevenuefromsaleofrightsforthreeproductsofourPPDermabusiness-QoQbasisthegrossmargindeclinedby~260bps,primarilyonaccountof(a)changeinthebusinessmix,(b)increaseininventoryprovisions/write-offs,and(c)impactofpriceerosion.
SG&AexpensesforFY20atRs.
50.
1billion,anincreaseof3%onaYoYbasis.
SG&AexpensesforQ4atRs.
12.
2billion,YoYdeclineof1%andQoQdeclineof4%.
SG&Aasa%tosalesforthefullyearimprovedby290bpsascomparedtoFY19.
Ourfocusoncostoptimizationandproductivityimprovementcontinuetoyieldpositiveresults.
ImpairmentchargeatRs.
16.
8billioninFY20,whichweretakenconsideringthetriggerswhichoccurredduringtheyear.
Research&development(R&D)expensesatRs.
15.
4billion.
As%toRevenues–FY20:8.
8%|FY19:10.
1%.
Focuscontinuesonbuildingcomplexgenerics,bio-similarsanddifferentiatedproductspipeline.
R&DexpensesforQ4atRs.
4.
2billion,as%torevenuesstoodat9.
5%.
OtheroperatingincomefortheyearatRs.
4.
3billioncomparedtoRs.
2.
0billioninFY19.
TheincreaseisprimarilyonaccountofRs.
3.
5billionreceivedfromCelgenepursuanttoasettlementagreementinCanada.
NetFinanceincomefortheyearatRs.
1.
5billioncomparedtoRs.
1.
1billioninFY19.
TheincreaseisprimarilyonaccountofhigherforeignexchangegainincurrentyearascomparedtoFY19.
NetfinanceincomeinQ4isRs.
0.
4billion.
ProfitbeforeTaxfortheyearatRs.
18.
0billion,impactedbyRs.
16.
8billionofimpairmentcharge.
Adjustedforit,theprofitbeforetaxisatRs.
34.
8billion.
ProfitbeforeTaxforQ4isatRs.
7.
1billion.
ProfitafterTaxfortheyearatRs.
19.
5billionandforQ4atRs.
7.
6billion,whicharehigherthanprofitbeforetax,majorlyduetorecognitionofMATcreditandcreationofdeferredtaxassets,inlinewiththerequirementsofaccountingstandards.
DilutedearningspersharefortheyearisatRs.
117.
4.
DilutedearningspershareforQ4isatRs.
46.
0CapitalexpenditureforFY20isatRs.
4.
8billion.
CapitalexpenditureforQ4FY20isatRs.
1.
5billion.
TheBoardhasrecommendedpaymentofadividendofRs.
25perequityshareoffacevalueRs5/-each(500%offacevalue)fortheyearendedMarch31,2020subjecttoapprovalofmembers.
9EarningsCallDetails(05:15pmIST,07:45amEDT,May20,2020)TheCompanywillhostanearningscalltodiscusstheperformanceandansweranyquestionsfromparticipants.
AudioconferenceParticipantscandial-inonthenumbersbelow:UniversalAccessNumber:+912262801219Secondarynumber:+912271158120LocalAccessnumber:+917045671221(AvailablealloverIndia)InternationalTollFreeNumberUSA18667462133UK08081011573Singapore8001012045HongKong800964448Playbackofcall:+912271945757,+912266635757ConferenceID:74886Transcriptoftheeventwillbeavailableatwww.
drreddys.
com.
Theplaybackwillbeavailableaftertheearningscall,tillMay27th,2020.
AboutDr.
Reddy's:Dr.
Reddy'sLaboratoriesLtd.
(BSE:500124,NSE:DRREDDY,NYSE:RDY)isanintegratedpharmaceuticalcompany,committedtoprovidingaffordableandinnovativemedicinesforhealthierlives.
Throughitsthreebusinesses-PharmaceuticalServices&ActiveIngredients,GlobalGenericsandProprietaryProducts–Dr.
Reddy'soffersaportfolioofproductsandservicesincludingAPIs,custompharmaceuticalservices,generics,biosimilarsanddifferentiatedformulations.
Ourmajortherapeuticareasoffocusaregastrointestinal,cardiovascular,diabetology,oncology,painmanagementanddermatology.
Dr.
Reddy'soperatesinmarketsacrosstheglobe.
Ourmajormarketsinclude–USA,India,Russia&CIScountries,andEurope.
Formoreinformation,logonto:www.
drreddys.
comDisclaimer:Thispressreleasemayincludestatementsoffutureexpectationsandotherforward-lookingstatementsthatarebasedonthemanagement'scurrentviewsandassumptionsandinvolveknownorunknownrisksanduncertaintiesthatcouldcauseactualresults,performanceoreventstodiffermateriallyfromthoseexpressedorimpliedinsuchstatements.
Inadditiontostatementswhichareforward-lookingbyreasonofcontext,thewords"may","will","should","expects","plans","intends","anticipates","believes","estimates","predicts","potential",or"continue"andsimilarexpressionsidentifyforward-lookingstatements.
Actualresults,performanceoreventsmaydiffermateriallyfromthoseinsuchstatementsduetowithoutlimitation,(i)generaleconomicconditionssuchasperformanceoffinancialmarkets,creditdefaults,currencyexchangerates,interestrates,persistencylevelsandfrequency/severityofinsuredlossevents(ii)mortalityandmorbiditylevelsandtrends,(iii)changinglevelsofcompetitionandgeneralcompetitivefactors,(iv)changesinlawsandregulationsandinthepoliciesofcentralbanksand/orgovernments,(v)theimpactofacquisitionsorreorganisation,includingrelatedintegrationissues,(vi)thesusceptibilityofourindustryandthemarketsaddressedbyour,andourcustomers',productsandservicestoeconomicdownturnsasaresultofnaturaldisasters,epidemics,pandemicsorotherwidespreadillness,includingcoronavirus(orCOVID-19),and(vii)otherrisksanduncertaintiesidentifiedinourpublicfilingswiththeSecuritiesandExchangeCommission,includingthoselistedunderthe"RiskFactors"and"Forward-LookingStatements"sectionsofourAnnualReportonForm20-FfortheyearendedMarch31,2019.
Thecompanyassumesnoobligationtoupdateanyinformationcontainedherein.
Thecompanyassumesnoobligationtoupdateanyinformationcontainedherein.