Biocon knocks off 12%

By Sources   |   Friday, 21 April 2006, 07:00 Hrs
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BANGALORE: Impact of higher taxes and depreciation has knocked off 12 percent from Biocon’s bottom line for fiscal 2005-06. The country’s only listed biotech entity today reported a net profit of $3.5 billion on a consolidated basis as against $4.1 billion in the previous fiscal, a drop of 12 percent.

However, total revenues for the financial year raised 9 percent, touching $18.2 billion as against $16.5 billion in the previous fiscal. For FY06, the depreciation cost stood at $6.5 billion as against in $5 billion in the previous fiscal while the impact of taxes was at $7.0 billion against $4.0 billion in the previous fiscal. The operating margin also declined by 2 percent to 30 percent during the reporting fiscal while the net margin was maintained at 22 percent.

Biocon CMD Kiran Mazumdar-Shaw said, ¬ďThe year ahead will continue to be challenging due to uncertainties in market conditions and the impact of depreciation at our new facilities at Biocon Park.¬Ē The company has made significant investments into its new SEZ facilities.

Also, the pricing pressures are likely to continue with the statins market going off patent in June this year. She said that the operating margin on annualized basis is expected to remain at 30 percent though the market conditions will remain volatile. Of the total sales of $17.9 billion, biopharmaceuticals contributed the most at $13.7 billion. But the fastest growing segment was contract research services, which grew at 52 percent to touch $22.7 billion from $15.0 billion in FY05.

Biocon has declared a dividend of 50 percent. At the end of the fiscal under review, the company’s EPS stood at 17.4, down 12 percent from 19.8 for FY05.

In terms of sequential growth, Biocon reported a net profit of $10.9 billion for the fourth quarter of 2005-06, up 9 percent from $10 billion in Q3 FY06, while its net income during the same period stood at $4.8 billion, showing a sequential growth of 7 percent over $4.5 billion.

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