BackCipla profits slip 34% after sales dip in West
Cipla profits slip 34% after sales dip in West
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Mumbai: Cipla Ltd reported a 34% fall in quarterly net profit because of a high base and lower sales in Western markets, but the drug maker forecast steady growth in the current fiscal year.
“Our guidance would be top line growth of 10-12%," chief financial officer S. Radhakrishnan said after Cipla announced lower-than-expected earnings for the January-March quarter after market hours on Thursday.
He said net profit in the current fiscal year to March 2008 would be 15-18% of sales, about the same as fiscal 2006/07 but better than 13.1% in the January-March quarter.
The company’s net profit dropped to Rs126 crore from Rs191 crore in the same quarter a year ago. A Reuters poll had forecast net profit to rise 6.4% to Rs200 crore.
Radhakrishnan said the company’s performance in the same quarter last year was exceptionally good because of strong sales in Western markets.
During the quarter, exports, as a percentage of sales, fell to 57% from 61%, the company said in a statement.
Ahead of the earnings, Cipla’s shares closed 0.4% higher at Rs253.25 in a flat Mumbai market. Cipla’s stock has risen 10% in the last seven trading sessions on expectations of stronger earnings.
Other leading drug companies are expected to post stronger results, analysts say.
New Delhi-based Ranbaxy Laboratories, which aims to be one of the top five generic players with $5 billion in annual sales by 2012, is forecast to report on Friday that net profit grew 75% to Rs125 crore on a turnover of Rs1,550 crore.
Ranbaxy said in January it would maintain its operating margins at 16%, while sales would rise 15% in 2007. Dr Reddy’s Laboratories is forecast to report a net profit of Rs176 crore against a loss of Rs23.6 crore a year ago.
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