Dishman Pharma FY11 consol net down on higher costs

Dishman Pharma FY11 consol net down on higher costs

Mumbai: Drugmaker Dishman Pharmaceuticals and Chemicals reported a 31.8% dip in consolidated annual net profit on mounting raw material and operational costs.

The bulk drugmaker and contract researcher on Thursday reported a consolidated net profit of 800.1 million for FY11 on net sales of 991 crore.

Although Dishman Pharma’s consolidated sale grew about 7% in the year, a substantial rise in raw material costs and operational expenses hurt profit.

“The company’s Swiss subsidiary is bleeding and that is actually hitting the company’s performance," Siddhant Khandekar, analyst at ICICI Securities, said.

Dishman’s raw material cost rose 26.3% to 293 crore in FY11, while its spend on purchase of traded goods more-than-doubled to 901.2 million. Its employee cost also rose about 10% to 280 crore for the year ended 31 March, it said.

“The CRAMS (contract research and manufacturing services) business is seeing slow recovery but that won’t help Dishman much considering the rising costs," he added.

Shares of Dishman Pharmaceuticals ended at 95.50 on Thursday, up 3.75% in a firm Mumbai market.