Dr Reddy's Laboratories Q2 Results: Dr Reddy's Laboratories announced its July-September quarter results for fiscal 2024-25 (Q2FY25) on Tuesday, November 5, reporting a drop of 9.5 per cent in consolidated net profit to ₹1,342 crore, compared to ₹1,482 crore in the corresponding period last year.
India's leading pharmaceutical company missed analysts' expectations in Q2FY25 net profit and was weighed down by pricing pressure in a competitive North American market, which is their biggest by revenue. Dr Reddy's was also hit by one-time charges related to its joint venture with Nestle India and Nicotinell acquisition.
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The drugmaker's total revenue from operations in the second quarter of current fiscal rose 16.5 per cent to ₹8,016 crore as its revenue from North America climbed 17 per cent, compared to ₹6,880.2 crore in the year-ago period. Dr Reddy's largely attributed the sales growth in the region to a rise in volumes but said it was partly offset by price erosion.
Since its launch in 2022, drugmakers have benefited from strong sales across North America for their generic version of Bristol-Myers Squibb's popular cancer treatment drug Revlimid. This and other generic drugs used to treat gastrointestinal and cardiovascular issues boosted sales for Dr Reddy's in the region.
Dr Reddy's reported an impairment charge in the quarter under review due to supply chain constraints in the US affecting a particular generic medical product. Revenue from the India business, the pharma major's second-biggest market, climbed 18 per cent to ₹1,397 crore. Shares of Dr Reddy’s Laboratories settled 0.36 per cent higher at ₹1,272.55 apiece on the BSE.
Revenue from Pharmaceutical Services and Active Ingredients rose 16.76 per cent to ₹1,103 crore. Revenue from the Global Generics segment surged 17.17 per cent to ₹7,157.6 crore in the September quarter. However, its revenue from the 'Others' segment fell 73.83 per cent to ₹17.9 crore.
On the operating front, Dr Reddy's earnings before interest, taxes, depreciation, and amortization (EBITDA) during the September quarter rose 3.5 per cent to ₹2,054.5 crore, compared to ₹1,985.8 crore in the same period last year. The margin dropped to 25.6 per cent from 29 per cent a year ago.
“We delivered a good quarter and maintained the growth momentum across businesses. We made progress on our future growth drivers, operationalized our venture with Nestle and completed the acquisition of Nicotinell and related brands. We will continue to drive efficiency, strengthen our core businesses, and positively impact patient lives through science and innovation,” said G V Prasad, Co-Chairman & MD, Dr Reddy's Laboratories.
