Orchid Chemicals & Pharmaceuticals, which sold off its injectables business to US-based Hospira for $400 million last year, crossed $100 million (around Rs 450 crore) in revenues in a quarter for the first time, driven by a growth in its active pharmaceutical ingredients (APIs) business. The company posted a net profit after tax of Rs 56.62 crore for the quarter ended December 31, 2010, compared to a loss of Rs 18.91 crore of the corresponding third quarter of the previous financial year.

The results of both the quarters are not strictly comparable due to the sale of the injectables business to Hospira. The supply agreement with Hospira for APIs also resulted in an increase in inventory to the tune of Rs 50.23 crore in the quarter under review compared to Rs 45.44 lakh in the previous corresponding period. Material costs also increased to Rs 261.44 crore compared to Rs 127.34 crore in the previous quarter. However, the company compensated for this by pumping up its voumes in APIs.

The company, which has a 10 year agreement with Hospira as the sole supplier of APIs, also saw a consolidated turnover and operating income of Rs 478.5 crore for the quarter compared to Rs 360.45 crore registered during the corresponding third quarter of last financial year, representing a 33% growth. Orchid, which now derives 70% of its revenues as a supplier of APIs (its API division saw revenues of Rs 339.27 crore in the quarter under review), is planning to beef up its presence in the branded formulations business through the acquisition of 3-4 products. It aims to achieve 50% of its business from the branded generics segment over the next 2-3 years’ time, thereby scaling down its dependance on APIs to 50% by that time, its chairman & managing director K Raghavendra Rao said. ?We have to freedom to supply to new clents in the non-regulated markets, while in the regulated markets, we can add one client per product per year,? said Rao. On an average, the company has been adding 10-15 clients in the non-regulated markets, every year. ?The performance of our company has vindicated our business strategy,? Rao added.

Earnings before interest, depreciation & tax (ebitda) grew by 78% to Rs 134.95 crore compared to Rs 75.90 crore during the corresponding quarter of last year. Shares of Orchid were marginally down on the BSE on Wednesday to close at Rs 301.65. Orchid?s turnover and operating income for the nine months ended December 31, 2010 rose by 21% to Rs 1,245.59 crore, compared to Rs 1029.34 crore of the corresponding period of last fiscal. Ebitda grew by 31% to Rs 296.32 crore compared to Rs 226.76 crore registered during the corresponding period of the previous fiscal.