Drug maker Cipla Ltd on Monday said "multiple headwinds" are likely to impact the company's performance in the second half.
The company's shares fell 8.28% in intra-day trading on Monday before closing 7.33% lower at Rs 563.90 on BSE after its net profit declined 10.8% to Rs 377 crore in the second quarter ended September 30, 2018, as compared to Rs 423 crore in the corresponding period last year.
Revenue growth during the July-September period decreased 1.71% to Rs 4,012 crore, while Ebitda (earnings before interest, taxes, depreciation and amortisation) fell 6.34% to Rs 753 crore over the same period last fiscal.
In a statement, Cipla managing director and global chief executive officer Umang Vohra said the company had a modest quarter but maintained a strong performance in private market segment across geographies, and its limited competition assets in the US are ramping up to drive quarter-on-quarter growth.
"As we enter the second half of this fiscal, multiple headwinds are likely to impact our reported performance. Having said that, we are focusing on positioning our businesses for long-term growth," he further said.
Though pricing pressure remained in the United States, Cipla's North America business grew 23% in the July-September quarter. Domestic sales were flat at Rs 1,644 crore as compared to Rs 1,645 crore in the year-ago period. Sales during Q2 FY2019 in Europe and South Africa fell 7% and 3%, respectively.
The street was expecting Cipla to report a net profit of around Rs 450 crore for the July-September quarter.
Cipla said there is pressure on tender businesses across markets, with higher crude and commodity prices along with an escalation in supplies sourced from China. This will continue to pose a challenge in the next two quarters, according to the company.
In a post-earnings presentation, the company said sanctions will impact reported performance in certain parts of the business. There will be a short-term impact due to capacity balancing in certain specific categories at its plants.
A WEAK DOSE
- Cipla’s net declined 10.8% to Rs 377 crore in the second quarter ended September 30
- The street was expecting Cipla to report a net profit of around Rs 450 crore
