Ranbaxy posts Q3 loss of Rs 454 cr on forex woes

Drug major Ranbaxy Laboratories has posted a consolidated net loss of Rs 454.16 crore for the third quarter ended September 30, due to foreign exchange charges and one-time provision made for the Mohali plant, which has come under the USFDA scanner.

The Gurgaon-based company had posted net profit of Rs 754.17 crore during the same period of the previous year.

The depreciation of rupee against the dollar, though favourable to Ranbaxy's export business, had an adverse impact on the company mainly due to applying of accounting standards that require marking-to-market the entire derivatives and foreign currency denominated loans outstanding, Ranbaxy Laboratories said in a statement.

"There was a charge of Rs 360 crore during Q3, 2013 and Rs 760 crore during YTD (September 13) on account of these forex items mentioned above," it added.

During the period under review, the company also made a provision for Mohali stock write-off and other costs amounting to Rs 70 crore, it said. The company's SEZ unit in the city had received an import alert from USFDA and cannot export drugs made in this plant to the US market.

Net sales of the company rose to Rs 2,750.17 crore during the third quarter, compared to Rs 2,668.52 crore in the same period of the previous year.

The company is confident that it will satisfactorily address the increasing standards of quality and manufacturing processes to uphold the high level of trust that doctors, patients, regulators and other stakeholders expect from the company, Ranbaxy CEO and Managing Director Arun Sawhney said.

The company continues to grow in its focus branded markets in Asia, East Europe, CIS and Africa, he added.

"In India, however, the announcement of the pricing policy caused some uncertainty in the market, during which our sales in the home market faced some disruptions," Sawhney added.

The central government had last year brought 348 essential drugs and price regulatory mechanism.

On the the outlook, the company said it expects to achieve sales of Rs 13,000-Rs 13,500 crore for 15 months period ending March 31 2014.

"This does not consider any sales accruing from first-to file (FTFs) which shall be accounted for as they materialise," the company said.

Ranbaxy's board, which met on Tuesday, decided to change the financial year of the Ranbaxy as April-March effective April 1, 2014. In view of this, the current financial year (January-December) will be for a period of 15 months - January 2013 to March 2014, the company added.

Ranbaxy scrip closed at Rs 385.65 on BSE, down 0.82 per cent from its previous close.