Morepen Labs Reports 24% Rise in its Net Sales and 34% Rise in Net Profit in First Half of FY 2019-20 Led by a Significant Jump in its Bulk Drugs and Home Diagnostics Businesses

New Delhi, Delhi, India | 13^th November 2019: Highlights of First Half (H1) FY 2019-20 (Standalone)

• Net Sales Revenue recorded a growth of 24.2 per cent at Rs. 383.30 crore in H1 FY 2019-20 as compared to Rs. 308.56 crore in the corresponding first half of the previous fiscal.
• EBIDTA was up by 31.8 per cent in H1 FY 2019-20 at Rs. 37.44 crores (Rs. 28.40 crores) and Cash profit during the same period was up by around 32.4 per cent at Rs. 36.63 crores(Rs. 27.67 crores).
• Net Profit before tax went up by 87.5 per cent in H1 FY 2019-20 at Rs. 18.10 crore (Rs. 9.65 crore). The Net Profit after Tax during the period stood at Rs. 12.95 crore, up by 34.1 per cent from Rs. 9.65 crore net profit registered in the corresponding period of FY’2018-19.
• API sales were up by 37 percent at Rs. 228.79 crores in H1 FY 2019-20, constituting 60 per cent of the total turnover. Within the API segment, Exports registered an impressive growth of 46 percent at Rs. 172 crore.
• Export sales in H1’FY 2019-20 for Montelukast Sodium rose by 156 percent and that of Atorvastatin Calcium by 43 percent vis-a-vis the corresponding first half of the previous fiscal. In domestic market, Atorvastatin registered growth of about 172 per cent during the same period.
• Blood Glucose Monitors and Nebulisers half yearly sales grew by 33 percent and 60 percent respectively.
• The company has sold around 74.42 million Blood Glucose testing strips in H1 FY 2019-20 as against 54.45 million glucose strips sold in the corresponding period of the previous fiscal, thus registering a growth of 37 per cent. It has achieved a milestone of selling 360 million glucose testing strips till September 30^th, 2019.
• Branded Formulations’ half yearly sales have recorded a growth of 15 percent.
• Over the Counter (OTC) business has recorded growth of 11% in its sales revenue during the first half, however, Isabgol and other small base brands grew by 36 per cent and 105 per cent respectively in the same period. This Business has been strengthened further with many new products in the nutritional and preventive healthcare segments.
• Internal accruals stream continued to get even more stronger, be it on operating profit front or cash profit front.
• Company has recently launched three new APIs – Rivaroxaban, Vildagliptin, and Ursodeoxycholic Acid in Cardiac, Diabetes and Liver segments, respectively.
• Morepen’s tie up with Vesale Pharma of Belgium began its commercial operations during the first quarter (Q1) of FY 2019-20 with the launch of a new generation probiotics (Brand: Intebact) in the domestic market. The tie-up has made a steady progress during the second quarter (Q2).

Morepen Laboratories Ltd. has reported a Net sales Revenue (Standalone) of Rs. 383.30 crore in the half year ended September 30^th, 2019, registering a growth of 24.2 per cent as compared to the Net Sales Revenue of Rs. 308.56 crore in the corresponding first half of the previous fiscal. Total Revenue (Standalone) in first half stood at Rs. 392.44 crore (Rs. 313.06 crore) registering a jump of 25.4 per cent. EBIDTA was up by 31.8 per cent in H1’ FY 2019-20 at Rs. 37.44 crores (Rs. 28.40 crores) and Cash profit during the same period was up by around 32.4 per cent at Rs. 36.63 crores(Rs. 27.67  crores).

The Net Profit Before Tax (Standalone) almost doubled in the first half at Rs. 18.10 crore compared to Rs. 9.65 crore in the corresponding first half of previous fiscal. The Net Profit after Tax (Standalone) during the period stood at Rs. 12.95 crore, up by 34.1 per cent from Rs. 9.65 crore net profit registered in the corresponding period of FY’2018-19. The half yearly net profit has increased by a good 34 per cent despite a one-time hit of Rs. 5.15 crore taken by the company by writing off MAT credit entitlement in line with the new Taxation Laws (Amendment) Ordinance 2019 in Q2 FY 2019-20.

The bulk drugs (API) segment contributed around 60 per cent to the company’s total turnover in H1 FY 2019-20. The company’s expanding export reach assisted in achieving a higher topline in first half of FY 2019-20. API’s Export sales registered a growth of 46 per cent at Rs. 172 crore in the first half under consideration. Export sales for Montelukast Sodium rose by 156 percent at Rs. 46.30 crore and that of Atorvastatin Calcium by 43 percent at Rs. 36.25 crore in H1 FY 2019-20 vis-a-vis the corresponding period of the previous fiscal. New Molecules registered 159 percent growth at Rs. 10.20 crore.

This was disclosed by Mr. Sushil Suri, Chairman and Managing Director, Morepen Laboratories Ltd., after the Q2 and First Half results board meeting here on Wednesday. “All our focus is currently on the growth strategy for next five years. In line with this objective, the company is expanding its reach further into export markets and has also widened its offered portfolio of APIs by adding three new APIs in Cardiac, Diabetes and Liver segments to it. All these news APIs have been developed by the company’s in-house R&D team. This apart, the domestic OTC health basket is being strengthened further with many new products in the nutritional and preventive healthcare segments,” Mr. Suri said.

Synopsis of First Half (H1) and Second Quarter (Q2) FY 2019-20-Performance (Standalone)

Rs. in Crores

Major API exports in the first half were done to APAC (Asia Pacific) markets accounting for around 54 per cent of the total API exports, followed by the US and European markets (around 39 per cent) and other semi-regulated markets (around 7 per cent). While APAC business grew by 59 per cent, USA business registered a growth of 33 per cent, European business (27 Per cent) and business from other semi-regulated markets (52 per cent).

Company has launched three new APIs – Vildagliptin (Diabetes segment), Rivaroxaban (Cardic Segment) and Ursodeoxycholic Acid (for Liver ailments). The three drugs will currently be sold in India and patent-free markets worldwide. The Drug Master File for regulatory markets will be filed within the next 12 months’ time frame.

The overall Home Diagnostic Segment recorded total sales of Rs. 85.55 crore in H1 FY 2019-20, registering a rise of 23 per cent vis-a-vis corresponding period of the previous fiscal. Blood Glucose Monitors and Nebulisers recorded highest growth in the half year @ 33 per cent and 60 per cent, respectively. The combined sales revenue of Blood Glucose Monitors and Blood Pressure Monitors in the half year increased to Rs. 78.01 crore as compared to Rs. 61.19 crore in the corresponding period of previous fiscal, registering a growth of 27 per cent. Looking at increasing incidence of diabetic cases in India, the Blood Glucose Monitors and Blood Pressure Monitors segment offers great opportunity for growth in the coming years. In all, around 360 million Glucometer strips have been sold by the company till date and Blood Glucose Monitors installations have crossed 3.2 million target.

Morepen Labs’ pharma division commenced commercial sales of its Probiotics in India during Q1 FY 2019-20. The company has made steady progress in this business during Q2 FY 2019-20 in the domestic market. It may be recalled that Morepen recently tied up with Vesale Pharma of Belgium to launch latter’s complete range of probiotics in the Indian market.

OTC Business has recorded growth of 11% in its sales revenue in H1 FY 2019-20. Isabgol and other small base brands grew by 36 per cent and 105 per cent respectively. OTC Business witnessed launch of many new products to its Health basket including Active Smile, Dr. Morepen Daily, MTP Kit, VCALCI, Clean & Pure, Liv Healthy, Head-X, Dr. Morepen Aid, Dr. Morepen Buds, COLD-EX, Paachan-Arishta and Adult Nasal Spray in various new product categories. New products are expected to add significantly to the company’s topline in the coming quarters.

Morepen Laboratories Ltd. has reported a net sales revenue (standalone) of Rs. 196.60 crore in Q2’FY 2019-20, registering a growth of 23 per cent vis-a-vis net sales revenue of Rs. 159.73 crore in Q2 FY 2018-19. The company’s EBIDTA in Q2 FY 2019-20 increased by 7 per cent at Rs. 17.71 crore and cash profit increased by 6.4 per cent at Rs. 17.32 crore as against Rs. 16.59 crore and Rs. 16.28 crore, respectively, in the corresponding quarter of the previous fiscal.

The Net Profit Before Tax (standalone) for Q2 FY 2019-20 stood at Rs. 9.69 crore, registering a rise of 36.4 per cent. However, as aforesaid, on account of the one-time hit of Rs. 5.15 Crores taken by the company during the quarter by writing off its MAT credit entitlement, the Net profit after tax (PAT) decreased by 38 per cent at Rs. 4.54 crore compared to Rs. 7.29 Crore in the corresponding quarter of the previous fiscal.

API Exports grew by 43 per cent at Rs. 92.48 crore in Q2 FY 2019-20 with Montelukast registering 112 per cent growth at Rs. 21.08 crore, Atorvastatin 33 per cent growth at Rs.19.96 crore and New Molecules registering 63 percent growth at Rs. 4.24 crore vis-a-vis the corresponding quarter of the previous fiscal. The overall Home Diagnostic Segment grew by 30 per cent at Rs. 45.52 crore and OTC business by 15 per cent in Q2 FY 2019-20. Blood Glucose Monitors and B.P.Monitors recorded highest growth in the quarter @ 37 percent each. Isabgol and Lemolate brands grew by 41 per cent and 12 per cent, respectively Consolidated Total Revenue in H1 FY 2019-20 has grown by 24 percent at Rs. 419.50 Crore. Consolidated PBT in the period H1 FY 2019-20 has grown by 79 per cent at Rs. 16.92 crore and Consolidated net profit has registered growth of 24 per cent at Rs. 11.74 crore compared to that of FY 2018-19.