Q4 and Full Year FY2018 Earnings Presentation Providing Affordable and Innovative medicines for healthier lives
Highlights FY2018 vs. FY2017 Management Perspective “Continuing on strong growth momentum we gained during last few o Total Income of Rs. 3,670.9 million quarters, we are pleased to report stellar performance with 23% growth in the net profit during the year FY2018. Despite prevailing o EBITDA of Rs. 577.7 million, up 16.7% regulatory challenges and transitional impact of GST, our profitability EBITDA margin of 15.8%, up 214 bps has significantly improved as a result of increasing contribution from high margin exports business coupled with better product mix and o PBT of Rs. 462.5 million, up 23.9% fuel cost savings on account of optimum utilization of wind mill. PBT margin of 12.6%, increased 235 bps During the year, we received a patent for an anti-malarial drug, which has contributed meaningfully to the topline and expected to increase o PAT of Rs. 346.2 million, up 23.5% share of revenue in the next fiscal year. This patent win is a testament PAT margin of 9.5%, up 174 bps to our strong in-house R&D capabilities. o Total Debt of Rs. 1,226.9 million Going forward, we are very optimistic about our business outlook supported by a strong order book. Our investment in the R&D center Total Debt / Equity of 0.55x and Net Debt to LTM EBITDA of 1.87x are expected to contribute to the growth of the Company in the near term. ” o The Board of Directors has recommended 15% dividend (Rs.1.50/- Mr. Mahendra G. Patel, Managing Director per share) 2
Performance Overview Consolidated Financial Performance Q4 y-o-y Q3 q-o-q Full Year y-o-y Particulars FY2018 FY2017 Growth (%) FY2018 Growth (%) FY2018 FY2017 Growth (%) Total Income 679.8 1,208.7 (43.8)% 830.2 (18.1)% 3,670.9 3,680.7 (0.3)% EBITDA 105.1 39.9 163.2% 189.8 (44.7)% 577.8 495.1 16.7% Margin (%) 15.4% 3.4% 22.9% 15.8% 13.6% PBT 80.3 11.8 580.5% 162.2 (50.5)% 462.5 373.3 23.9% Margin (%) 11.8% 1.0% 19.5% 12.6% 10.3% Profit After Tax (PAT) 68.3 12.7 439.9% 115.8 (41.0)% 346.2 280.3 23.5% Margin (%) 10.0% 1.1% 13.9% 9.5% 7.7% Basic EPS (Rs.) 3.41 0.66 416.7% 5.79 (41.1)% 17.32 15.73 10.1% Dividend Per Share (Rs.) - - - - - 1.50 1.20 25.0% (Recommended) Note: Financials are as per IND-AS 3
Performance Overview Annual Revenue Breakup General Anti Infectives 5.7% 1.1% 2.1% Respiratory Systems 17.6% 2.2% Therapeutic Area 25.1% Alimentary Tract and Metabolism 25.5% 0.4% 10.3% Genito Urinary System and Sex Hormones 2.7% 1.5% Musculo-Skeletal System FY2018 FY2017 Parasitology 9.4% 13.9% Blood and Blood Forming Organs 15.3% 15.8% Cardiovascular System 11.7% 11.2% Central Nervous System 4.9% 10.8% 12.9% Others 35.0% Geography 41.0% International FY2018 FY2017 Domestic 59.0% 65.0% 4
Performance Overview Quarterly Revenue Breakup General Anti Infectives Respiratory Systems 15.1% Therapeutic Area 23.6% Alimentary Tract and Metabolism 24.8% 0.2% 28.8% 1.7% Genito Urinary System and Sex Hormones 1.1% Musculo-Skeletal System Q4 FY2018 2.6% Q4 FY2017 Parasitology 0.6% 20.7% Blood and Blood Forming Organs 15.7% 14.1% 8.7% Cardiovascular System Central Nervous System 5.6% 4.9% 2.3% 11.4% 12.2% 5.9% Others 36.0% Geography International 50.0% 50.0% Q4 FY2018 Q4 FY2017 Domestic 64.0% 5
Performance Trend Total Income (Rs. million) and Y-o-Y Growth (%) Q4 FY2018 Highlights (Y-o-Y) 64.4% 18.1% o Net profit during the quarter increased more 10.3% (5.9)% than 400% YoY. Profitability improved on the (43.8)% account of: 1,208.7 1,524.0 926.5 830.2 679.7 Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Increased share of exports business EBITDA (Rs. million) and Margin (%) better product mix 22.9% 19.9% 15.4% fuel cost savings on account of 6.4% optimum utilization of wind mill 3.4% 39.9 98.6 184.2 189.8 105.1 Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 PAT (Rs. million) and Margin (%) 13.9% 12.2% 10.0% 3.2% 1.1% 49.1 113.0 115.8 68.3 12.7 Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 6 Note: Financials for Q3 FY2017, Q2 FY2018 and Q3 FY2018 are as per IND-AS
Performance Trend Net Debt / LTM EBITDA Total Debt / Net Worth 0.6x 2.0x 0.5x 1.9x 1.2x 0.3x 1.0x 0.9x 0.2x 0.2x Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 ROCE 1 RONW 2 16.7% 15.4% 14.9% 14.5% 14.5% 14.4% 13.7% 13.0% 11.3% 11.0% Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Financials for Q4 FY2017, Q2 FY2018, Q3 FY2018 and Q4 FY2018 are as per IND-AS. Q3 FY2018 and Q4 FY2018 balance sheet numbers are as are as per IND-AS Note: 7 1. ROCE calculated as LTM EBIT/ Capital Employed 2. RONW calculated as LTM Net Profit/ Net Worth
Leverage Profile (Rs. million) Mar 31 st , 2018 Mar 31 st , 2017 Long Term Debt 177.6 217.7 Credit Rating Short Term Debt 1,049.4 908.9 o The Company’s debt facilities have been assigned the following ratings by ICRA Total Debt 1,226.9 1,126.6 Long term bank facilities: A- Less: Cash & Cash Equivalents 145.9 116.8 Short term bank facilities: A2+ Net Debt / (Net Cash) 1,081.0 1,009.8 Net Worth 2,245.4 1,926.9 Note Q4 FY2018 balance sheet numbers are as are as per IND-AS 8
Recent Developments Developed new NDDS formulation Ondansetron Oral Spray (Domi Up) for the first time in India 1 • Currently the Ondansetron formulation is available in the form of tablet, syrup and injectable. Lincoln Pharma has developed Ondansetron (Domi Up) as an oral spray which is first in India • Ondansetron Spray (Domi Up) is used in for travelling motion sickness, during Chemotherapy, pregnancy and ENT, Neurological and Cardiac surgeries • Indian Anti-emetic drug market is valued at Rs. 678 crores and Ondansetron has a potential market size of Rs. 303 Crores Launched Vaginal Spray for the first time in India 2 • Developed a new NDDS Micronized Progesterone Vaginal Spray unde the brand name ART-Luton • ART-Luton is used for the treatment of Luteal Phase Support in ART, dysmenorrhoea and premenstrual syndrome New Launches 3 • In FY2017, the Company launched 28 new products across therapeutic areas International Operations 4 • The Company has aggressively started the business in 13 Francophone African countries • The Company has got many new products registration 9
Research & Development Research Facilities R&D Expenditure (Rs. mn) and as % of Sales 3.2% 2.4% 2.0% 2.7% 117.3 Senior Scientist 15 1.6% 88.5 Junior Scientist 18 79.5 72.6 Analysts 18 Regulatory Personnel 12 34.3 Administrative Personnel 9 Others 6 FY14 FY15 FY16 FY17 FY18 Total 78 10
A Leading Pharmaceutical Company Research & Development Department Market Presence Presence in Presence in 4 Patents Granted 1,000 Registered Dossiers 60+ 25 25 Patents Applications 550 Ongoing Applications Countries States across India 43 rd 300+ 15+ 650 Field Staff Rank in AIOCD Formulations Developed Therapeutic Areas June 2017 in covered markets 30+ 500+ 22 C&F Agents 5,000 Stockiest Scientists SKUs 11
Key Milestones Received WHO – Becomes Public Covered 80% of all Developed & Launched Robust business growth in GMP for plant / Limited Company India Market 3 NDDS products domestic & international production unit from a Partnership markets 2017-18 2016-17 2015-16 2014-15 2010-11 2001 2000 1997-98 1995-96 1990 1984-85 Launched Next Generation Progesterone Therapy “ Prolin 1979 Spray” 1979 Started Started export to Domestic R&D Center started; Developed & Launch 3 products which are first time 12 Operations Tanzania and network across Export house launched 2 more in India. Entered in more (regulated) Mauritius nation certificate received NDDS products African and Latin American countries
Global Footprint Presence over 60 countries in Europe, Latin America, Africa, Asia Pacific and South East Asia; 22 states across India Jammu Uttaranchal Chandigarh Delhi Europe : Ambala Ghaziabad France Lucknow Guwahati Jaipur Patna Ranchi Ahmedabad Kolkata Indore Raipur Nagpur Cuttack Vijayawada Chennai Latin & Central America : Africa: Angola, Benin, Botswana, Asia: Afghanistan, Bhutan, Bangalore Bolivia, Chile, Costa Rica, El- Burkina Faso, Burundi, Cameroon, Cambodia, Fiji, Hong Kong, Salvador, Guatemala, Guyana, Congo, Ethiopia, Gabon, Ghana, Guinea, Iraq, Kazakhstan, Mongolia , Kochi Honduras, Jamaica, Panama, Ivory Coast, Kenya, Liberia, Madagascar, Myanmar, Nepal, Philippines, Peru, Suriname, Trinidad & Malawi, Mali, Matadi, Mozambique, Sri Lanka, Thailand, Vietnam Tobago, Venezuela, West Namibia, Niger, Nigeria, Rwanda, International Presence Indies Senegal, Seychelles, Sierra Leone, South C&F Agent Location in India Sudan, Sudan, Tanzania, Togo, Uganda, Yemen, Zambia, Zimbabwe, Zazibar 13
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