Sun Pharmas net dips 11% on US sales

Written by fe Bureaus | Mumbai | Updated: Oct 29 2009, 09:17am hrs
Mumbai-based Sun Pharmaceuticals Industries Ltd has reported a 11% decline in its net profit for the second quarter ending September 30, 2009, on the back of lower sales revenue from the US market. The company's net profit declined to Rs 453.8 crore from Rs 512.7 crore for the corresponding period last year. Its US subsidiary Caraco Pharmaceuticals reported a net loss of $6.6 million for the quarter against $8.42 million profit a year earlier. Caraco generated net sales of $78.4 million for the second quarter compared to $122.2 million in the same period last year. However, this was 63% more, compared with the immediate preceding quarter.

Investors had factored in the loss of revenues from the US in the financials for the quarter. Sun Pharma shares, therefore, ended the day marginally up on the BSE to close at Rs 1,377.70 .

Sun Pharmas consolidated net sales stood at Rs 1,185 crore for Q2 FY10 against Rs 1177 crore for the corresponding period of FY09. India branded generic sale stood at at Rs 471 crore, registering a growth of 5% over same quarter last year.

A statement from Caraco said, Sales of distributed products were significantly lower primarily as a result of significantly higher sales of paragraph IV products during both periods of fiscal 2009. Sales of distributed products were also lower due to price erosion for the products sold. During both periods, sales of Caraco-owned products were adversely affected by the actions of the FDA...and the cessation of manufacturing and in part due to the negative impact of voluntary recalls.

According to the company, international generic sales (excluding Caraco) have grown 29% over the same period last year, while international API sales have grown by 15% over corresponding quarter last year.

Dilip Shanghvi, CMD of the company, said, Performance across all business segments remains in line with our expectations. Caraco, which signed a consent decree with the

USFDA last month, continues to work towards regaining full cGMP compliance. We expect the core business momentum around growing profitably as well as developing, registering and launching new products to remain intact.