Earnings Review
Mankind Pharma net misses Street view on higher expenses
This story was originally published at 21:31 IST on 23 January 2025
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--Mankind Pharma Oct-Dec consol net profit INR 3.80 bln
--Analysts saw Mankind Pharma Oct-Dec consol net profit INR 4.69 bln
--Mankind Pharma Oct-Dec consol PAT INR 3.80 bln vs INR 4.54 bln year ago
--Mankind Pharma Oct-Dec consol revenue INR 32.30 bln vs INR 26.07 bln
--Mankind Pharma Apr-Dec consol net profit INR 15.70 bln vs INR 14.42 bln
--Mankind Pharma Apr-Dec consol revenue INR 92.00 bln vs INR 78.94 bln
By Anand JC
MUMBAI – Mankind Pharma Ltd. Thursday reported higher on-year consolidated revenue for the December quarter, which was offset by an increase in expenditure that weighed on the company's net profit. While the top line came close to the estimate of analysts, the bottom line missed it by a sizeable margin.
The consolidated net profit of Mankind Pharma for the latest quarter was INR 3.80 billion, 16% lower on year. Analysts had anticipated a net profit of INR 4.69 billion. For Apr-Dec, the net profit was INR 15.70 billion, 8.9% higher on year.
The pharmaceutical company's revenue from operations for the December quarter was INR 32.30 billion, 23.9% higher on year, but slightly lower than the Street's estimate of INR 32.42 billion. For Apr-Dec, the revenue was INR 92.00 billion, 16.5% higher on year.
The December quarter earnings report includes the impact of the company's acquisition of Bharat Serums and Vaccines Ltd. for a cash consideration of INR 137.68 billion. The purchase price allocation valuation was as of the acquisition date and done on a provisional basis. Excluding a fair value of INR 74.14 billion from the total consideration paid, the company has to pay a goodwill of INR 64.20 billion.
The total expenditure incurred by the company during the December quarter was INR 28.13 billion, up 32.8% from the corresponding period a year ago. This uptick in expenditure was driven by higher finance and staff costs.
Mankind Pharma's finance cost in the final quarter of 2024 grew to INR 2.20 billion, up from INR 91.89 million a year ago. Employee benefit expenditure in the quarter increased almost 25% on year to INR 7.10 billion while the cost of materials consumed grew 17.4% to INR 5.36 billion.
The standalone net profit margin of Mankind Pharma for the December quarter contracted to 17% from 21% for the corresponding period a year ago. The operating margin expanded to 31% in the quarter from 25% a year ago.
The adjusted earnings before interest, taxes, depreciation, and amortisation of Mankind Pharma for the December quarter stood at INR 8.95 billion, up 46% on year. For Apr-Dec, the company's operating profit was INR 24.76 billion, up 27% on year.
Mankind Pharma's market share rose to 4.8% as of Dec. 31, from 4.4% in March, the company said. The secondary sales growth in its Indian pharmaceutical market during the December quarter fell to 5% from 7.4%, as the company took corrective measures to enhance field force efficiency, it said in a press release. The company was also affected by regulatory headwinds in certain key products in the acute segment in the domestic market.
Mankind Pharma's consumer healthcare business saw revenue growth of 30% on year for the December quarter. Secondary sales for Manforce condoms grew 13% on year, Gas-o-fast by 28%, and HealthOk grew 26%.
Revenue growth in the company's exports business was 121% on year on the back of an increase in new launches in its base business. Revenue from exports increased to INR 4.57 billion from INR 2.07 billion in the same period a year ago. Mankind Pharma, excluding Bharat Serums and Vaccines, launched one product in the export market in the final quarter of 2024, and four in Apr-Dec. The total number of products launched by the company in the US market now stands at 42.
The capital expenditure incurred by the company in the December quarter was INR 910 million, lower than the INR 990 million spent a year ago. Capital expenditure for Apr-Dec was INR 3.44 billion, up from INR 3.24 billion in the corresponding period a year ago.
Mankind Pharma disclosed its December quarter earnings after the market closed Thursday. Shares of the company closed at INR 2,635.05 billion on the National Stock Exchange, up 4.7%. End
Edited by Rajeev Pai
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