Biotechnology major Biocon Limited announced that its net profit for the first quarter of FY 2008-09 was down a whopping 71.6% at Rs 15 crore, as compared to the profit of Rs 53 crore posted a year ago. Biocon’s revenue for Q1 FY 09 stood at Rs 276.5 crore, up 1.5% from revenue recorded at Rs 272.2 crore for Q1 FY 08.
The company attributed the dip in margins to the Rupee volatility, owing to which it lost Rs 6.4 crore during the period, as compared to a lower forex-related loss of Rs 2.2 crore for Q1 FY08. Lack of licensing income during the first quarter of FY 09 was also cited as a cause for lower profitability.
Commenting on the company’s performance during the period, Biocon chairman and managing director Kiran Mazumdar Shaw said, “Biocon’s Q1 FY ’09 performance has been unfortunately impacted by the Rupee volatility, which has seen us make a mark-to-market provision of Rs 26 crores. We have consciously been conservative in making this provision. I believe that our business fundamentals are robust, which is well demonstrated by the strong profit growth in our core biopharmaceutical business.”
Shaw said that the absence of licensing income for the quarter, also hurt the company’s profitability for Q1.
“We are confident that licensing income will be significant this fiscal,” Shaw added. During the quarter, Biocon’s biopharmaceutical business grew 9% Y-o-Y, recording revenue of Rs 221.2 crore as compared to Rs 203.4 crore earned a year ago. Revenue from contract research dipped marginally by 2%, at Rs 42.7 crore from Rs 43.4 crore earned during Q1 FY ’08. The enzymes business had earned the company Rs 24 crore for Q1 of past fiscal.
The company’s contract research and manufacturing subsidiary Syngene was impacted by Rs 6 crore, owing to currency loss and operational delays, Biocon said.
“We expect the quarters ahead to compensate for the exchange losses booked this quarter and end the year with improved profitability,” Shaw said.
Meanwhile, its other subsidiary Clinigene, was operational at a new facility and was expected to grow at 100% during the fiscal 2009, the company said.
