Lawsuit settlements drag Sun Pharma into ₹2,227 cr loss in Q4
Drug major Sun Pharmaceutical Industries reported a surprise consolidated loss of ₹2,227.38 crore in the fourth quarter ended March 31, 2022, against a consolidated net profit of ₹842.4 crore in the year-ago quarter, the company said in an exchange filing on Monday. The loss was mainly on account of ₹3,723.15 crore as part of settlements of some class-action lawsuits in the U.S. The pharma major incurred an exceptional loss of ₹3,935.75 crore during the March quarter of 2022, compared with ₹672.81 crore in the corresponding period last year.
As per the filing, adjusted net profit for the quarter stood at ₹1,582.1 crore, up 18% YoY, after excluding the exceptional items of ₹3,935.75 crore and exceptional tax gain of ₹76.4 crore.
The consolidated revenue from operations rose 11% year-on-year (YoY) to ₹9,386 crore, from ₹8,463.74 crore in the corresponding period last year.
On the operating front, the Mumbai-headquartered company reported EBITDA (Earnings before Interest, Taxes, Depreciation, and Amortisation) at ₹2,279.7 crore, up 14.6% over Q4 last year, with an EBITDA margin at 24.3%.
For the full financial year, Sun Pharma reported a 49% growth in net profit at ₹3,389.28 crore, while revenue from operation increased by 15.6% to ₹38,426.42 crore.
Commenting on Q4 earnings, Dilip Shanghvi, managing director of the company, says: “FY22 was a good year with strong topline and EBITDA growth. All our geographies have recorded double digit growth and profitability has improved despite rising costs. The specialty business continues to ramp-up strongly with global Ilumya sales recording 81% growth to reach $315 million in FY22.”
Speaking on the performance of India business, Dilip Shanghvi says the operation continues to grow faster than the market, leading to an increase in market share. “We continue to focus on expanding our global specialty business, growing all our businesses, and on improving operational efficiencies,” he adds.
Segment wise, Q4FY22 sales in India were at ₹3,095.6 million, up by 16% over Q4 last year and accounting for 33% of total sales. For the full year FY22, sales of formulations in India were at ₹12,759.3 crore, up by 23% over the same period last year.
Formulation sales in the U.S. for the full year FY22 were $1,526 million recording a growth of 12% over the same period last year. For Q4FY22, sales stood at $389 million, a growth of 5% over Q4 last year and accounting for about 31% of total consolidated sales.
Meanwhile, formulation sales in emerging markets stood at $905 million in FY22, up 16% as compared to last year. For Q4FY22, sales were at $206 million, a growth of 7% over Q4 last year and accounting for about 17% of total consolidated sales for the quarter.
Active Pharmaceutical Ingredients (API) sales declined 6% to ₹1,835.4 crore in FY22, while sales for Q4FY22 fell 5% to ₹413.7 crore over the same period last year. “API business imparts benefits of vertical integration and continuity of supply chain for our formulations business. We continue to focus on increasing API supplies for captive consumption relating to our key products,” says the company.
Sun Pharma’s board announced a final dividend of ₹3 per equity share. It also approved the appointment of Pawan Goenka as a lead independent director and the reappointment of Dilip Shanghvi and Gautam Doshi as directors.
Ahead of the earnings report, Sun Pharma shares closed trade at ₹888.10, down 1.75% on the BSE.