Net Sales up 40.0%, EBITDA up 54.4% and Net profits up 55.1%

Mumbai: Pharma Major Lupin Limited reported its performance for the first quarter ending June 30th, 2016. These results were taken on record by the Board of Directors at a meeting in Mumbai today.

Key Financial & Performance Highlights

Task

• Net Sales for the quarter grew by 40.0% to Rs. 43,136 m., as compared to Rs. 30,809 m. in Q1 FY2016
  • Net Sales in Q1 FY2017 grew by 5.7% sequentially as compared to Rs. 40,823 m. in Q4 FY2016

• Earnings before Interest, Tax, Depreciation and Amortization (EBITDA) for the quarter was 32.2% of net sales and grew by 54.4% to Rs. 13,907 m. as compared to Rs. 9,005 m. in Q1 FY2016
  • EBITDA in Q1 FY2017 grew by 3.8% sequentially as compared to Rs. 13,399 m. in Q4 FY2016

• Net profits for the quarter grew by 55.1% to Rs. 8,820 m. as compared to Rs. 5,686 m. in Q1 FY2016
  • Net profits in Q1 FY2017 grew by 17.9% sequentially as compared to Rs. 7,479 m. in Q4 FY2016

• Investment in Research for the quarter was Rs. 4,994 m., 11.6% of net sales

Business Performance (Refer to the Key Markets – Business Mix Section, Page 4)

• US formulation sales increased by 78.9% to USD 322 m. in Q1 FY2017, as compared to Q1 FY2016
• Japan sales increased by 30.9% to Rs. 4,232 m. in Q1 FY2017, as compared to Q1 FY2016

Commenting on the results, Mr. Nilesh Gupta, Managing Director, Lupin Limited, said “In keeping with the growth momentum, we continue to execute flawlessly and have delivered our best results to date. This was a record quarter, driven by robust growth across all our key markets – the United States, India and Japan. We remain committed to maintaining our growth trajectory given new product launches and approvals driven by strategic investments in technology and research.”

Consolidated financial Results – Quarter I, FY2017

Figures in Rs. M

Particulars	Q1 FY2017	% of net sales	Q1 FY2016	% of net sales	YoY growth %	Q4 FY2016	% of net sales	QoQ growth %
Net sales	43,136	100.0%	30,809	100.0%	40.0%	40,823	100.0%	5.7%
Other operating income	1,259	2.9%	752	2.4%	67.4%	884	2.2%	42.4%
Total revenue	44,394	102.9%	31,561	102.4%	40.7%	41,707	102.2%	6.4%
Raw material consumed	12,719	29.5%	9,835	31.9%	29.3%	11,010	27.0%	15.5%
Gross margin (excl. other operating income)	30,416	70.5%	20,974	68.1%	45.0%	29,813	73.0%	2.0%
Employees cost	7,059	16.4%	4,973	16.1%	42.0%	5,779	14.2%	22.1%
Manufacturing & other expenses	11,535	26.7%	8,505	27.6%	35.6%	11,868	29.1%	-2.8%
Operating margin	13,081	30.3%	8,248	26.8%	58.6%	13,050	32.0%	0.2%
Other income	826	1.9%	757	2.5%	9.2%	349	0.9%	136.8%
EBITDA	13,907	32.2%	9,005	29.2%	54.4%	13,399	32.8%	3.8%
Depreciation & Amortization	2,027	4.7%	1,014	3.3%	100.0%	1,487	3.6%	36.3%
EBIT	11,880	27.5%	7,991	25.9%	48.6%	11,912	29.2%	-0.3%
Finance cost	320	0.7%	70	0.2%		213	0.5%	50.3%
PBT	11,560	26.8%	7,921	25.7%	45.9%	11,699	28.7%	-1.2%
Tax	2,734	6.3%	2,258	7.3%	21.1%	4,188	10.3%	-34.7%
PAT	8,826	20.5%	5,663	18.4%	55.8%	7,511	18.4%	17.5%
Share of profit from Joint Venture	0	0.0%	20	0.1%		19	0.0%
Minority Interest	6	0.0%	(3)	0.0%		51	0.1%
Net profit	8,820	20.4%	5,686	18.5%	55.1%	7,479	18.3%	17.9%

Profit & loss highlights

• Material cost decreased by 2.4% to 29.5% of net sales, at Rs. 12,719 m., as compared to Rs. 9,835 m. in Q1 FY2016
• Personnel cost increased by 0.3% to 16.4% of net sales, at Rs. 7,059 m., as compared to Rs. 4,973 m. in Q1 FY2016
• Manufacturing and other expenses decreased by 0.9% to 26.7% of net sales at Rs. 11,535 m., as compared to Rs. 8,505 m. in Q1 FY2016
• Investment in Research for the quarter was Rs. 4,994 m., 11.6% of net sales

Balance sheet highlights

• Operating working capital decreased to Rs. 48,857 m. as on June 30th, 2016 as against Rs. 54,886 m. as on March 31st, 2016. The working capital number of days stands at 102 days as on June 30th, 2016 as against 146 days on March 31st, 2016
• Capital Expenditure for the quarter was Rs. 5,633 m.
• Net Debt-Equity ratio for the company stands at 0.43:1

Business Segments – Sales Mix

Task

Particulars	Q1 FY2017	Q1 FY2016	YoY growth %	Q4 FY2016	QoQ growth %
Formulations	40,267	27,534	46.2%	37,979	6.0%
North America	21,886	12,004	82.3%	21,905	-0.1%
India	9,313	8,849	5.2%	7,561	23.2%
APAC	5,416	4,076	32.9%	4,532	19.5%
EMEA	2,194	1,819	20.6%	2,452	-10.5%
LATAM	1,089	616	76.8%	924	17.9%
ROW	369	170	117.1%	605	-39.0%
API	2,869	3,275	-12.4%	2,844	0.9%
Total	43,136	30,809	40.0%	40,823	5.7%

Task

Operational Highlights

Task

North America

Lupin’ sales in North America grew by 82.3% to Rs. 21,886 m. during Q1 FY2017 as compared to Rs. 12,004 m. during Q1 FY2016; contributing 51% of Lupin’s global sales.

• US sales grew by 78.9% to USD 322 m. during Q1 FY2017 as compared to USD 180 m. during Q1 FY2016. US sales declined by 1% during Q1 FY2017 as compared to USD 325 m. during Q4 FY2016
• The Company launched 3 products in the US market during the quarter. The Company now has 123 products in the US generics market
• Lupin is now the market leader in 46 products marketed in the US generics market and amongst the Top 3 in 80 of its marketed products (market share by prescriptions, IMS Health, June 2016)

India

Lupin’s India formulation sales grew by 5.2% to Rs. 9,313 m. during Q1 FY2017 as compared to Rs. 8,849 m. during Q1 FY2016; contributing 22% of Lupin’s global sales. The India Formulation business grew by 23.2% sequentially as compared to Rs. 7,561 m. during Q4 FY2016.

Asia-Pacific (APAC)

Lupin’s APAC sales grew by 32.9% to Rs. 5,416 m. during Q1 FY2017 as compared to Rs. 4,076 m. during Q1 FY2016; contributing 12% of Lupin’s global sales.  APAC sales grew by 19.5% sequentially as compared to Rs. 4,532 m. during Q4 FY2016.

Lupin’s Japan sales grew by 11.1% to JPY 6,868 m. during Q1 FY2017 as compared to JPY 6,183 m. during Q1 FY2016 and grew by 15.8% sequentially as compared to JPY 5,930 m. during Q4 FY2016.

Lupin’s Philippines sales grew by 65.5% to PHP 487 m. during Q1 FY2017 as compared to PHP 295 m. during Q1 FY2016 and grew by 10.6% sequentially as compared to PHP 441 m. during Q4 FY2016.

Europe, Middle-East and Africa (EMEA)

Lupin’s EMEA sales grew by 20.6% to Rs. 2,194 m. during Q1 FY2017 as compared to Rs. 1,819 m. during Q1 FY2016; contributing 5% of Lupin’s global sales. EMEA sales declined by 10.5% sequentially as compared to Rs. 2,452 m. during Q4 FY2016.

Lupin’s South Africa sales grew by 31.9% to ZAR 205 m. during Q1 FY2017 as compared to ZAR 155 m. during Q1 FY2016 and declined by 20.4% sequentially as compared to ZAR 258 m. during Q4 FY2016. Lupin remains the 4th largest generic player in the South African market.

Lupin’s Germany sales grew by 88.2% to Euro 6.4 m. during Q1 FY2017 as compared to Euro 3.4 m. during Q1 FY2016 and declined by 12.3% sequentially as compared to Euro 7.3 m. during Q4 FY2016.

Latin America (LATAM)

Lupin’s LATAM sales grew by 76.8% to Rs. 1,089 m. during Q1 FY2017 as compared to Rs. 616 m. during Q1 FY2016; contributing 2% of Lupin’s global sales.  LATAM sales grew by 17.9% sequentially as compared to Rs. 924 m. during Q4 FY2016.

Lupin’s Brazil sales grew sequentially by 12.9% to BRL 31 m. during Q1 FY2017 as compared to BRL 27 m. during Q4 FY2016.

Lupin’s Mexico sales grew by 0.8% to MXN 132 m. during Q1 FY2017 as compared to MXN 131 m. during Q1 FY2016 and grew by 13.5% sequentially as compared to MXN 116 m. during Q4 FY2016.

API

Global API sales declined by 12.4% to Rs. 2,869 m. during Q1 FY2017 as compared to Rs. 3,275 m. during Q1 FY2016; contributing 7% of Lupin’s global sales.  API sales grew by 0.9% sequentially as compared to Rs. 2,844 m. during Q4 FY2016.

R&D

Revenue expenditure on R&D for Q1 FY2017 amounted to Rs. 4,994 m., 11.6% of net sales.

Lupin filed 2 ANDAs and received 7 approvals from the US FDA during the quarter. Cumulative ANDA filings with the US FDA stood at 336 as of June 30th, 2016, with the company having received 187 approvals to date. The Company now has 45 First-to-Files (FTF) filings including 25 exclusive FTF opportunities. Cumulative DMF filings stands at 172 as of June 30th, 2016.

The Company received 4 MAAs approval from the European authority during the quarter. Cumulative filings with European authorities now stands at 67 with the company having received 54 approvals to date.

About Lupin Limited

Lupin is an innovation led transnational pharmaceutical company producing and developing a wide range of branded & generic formulations, biotechnology products and APIs globally. The Company is a significant player in the Cardiovascular, Diabetology, Asthma, Pediatric, CNS, GI, Anti-Infective and NSAID space and holds global leadership position in the Anti-TB segment.

Lupin is the 5th largest generics player in the US (5.51% generic market share by prescriptions – IMS Health, National Prescription Audit, MAT March 2016) and the 2nd largest Indian pharmaceutical company by market capitalization. The Company is also the 9th largest generic pharmaceutical player in Japan and the 4th largest generic pharmaceutical company in South Africa (IMS Health, March 2016).

For the financial year ended 31st March, 2016, Lupin’s Consolidated sales and Net profit stood at Rs. 136,539 million (USD 2.09 billion) and Rs. 22,607 million (USD 345 million) respectively. Please visit http://www.lupin.com for more information.

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CIN: L24100MH1983PLC029442 Registered Office: Lupin Ltd, 3rd Floor, Kalpataru Inspire, Off Western Express Highway, Santacruz (East), Mumbai 400 055.

For further information or queries please contact –

Shamsher Gorawara
Head – Corporate Communications
Lupin Limited:
Ph: +91 98 20 338 555
Email: shamshergorawara@lupin.com

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