Mumbai: GlaxoSmithKline Pharmaceuticals Ltd (GSK India), the 49% subsidiary company of the British drug major GlaxoSmithKline Plc, posted a 9% year-on-year growth in net profit to Rs111.32 crore during the January–March quarter of the financial year 2007. The company follows a January to December financial year.
GSK India managed this profit growth despite sales for the quarter at Rs458 crore remaining almost unchanged from Rs456 crore during January-March 2006. The stock price of GSK India fell 3.22% on the Bombay Stock Exchange to Rs1,161.95. The company announced its results after trading was over for the day.
The lack of significant growth in sales is due to the company selling off its animal health care business in April 2006 to French Virbac Animal Health for Rs207 crore.
The animal health business had been contributing 10-12% to the revenue of the company. The company’s remaining pharmaceutical business showed a year-on-year growth of 5%.
A GSK India spokesman said: “The growth in the pharmaceutical business was almost along expected lines. There was no significant jump anticipated in sales since there were no big product launches during this quarter.”
Analysts tracking the sector pointed out that slow growth in the antibiotic segment during the quarter has also contributed to GSK’s low sales growth. GSK’s flagship brand augmentin is one of the largest selling antibiotics in the Indian pharmaceuticals market.
A media release from GSK India stated that the company has adopted new accounting standard for the ‘employee benefit scheme’ from 1 January 2007 onwards.
Consequently, the liability on this account amounting to Rs147 crore has been adjusted against general reserve in January with an additional staff cost of Rs50 lakh, said the release.