Biocon Q4FY19 Revenue up by 26% at INR 1,557 crore

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FY19 Revenue Up 31% at INR 5,659 crore; Net Profit Up 143% at INR 905 crore, Board Recommends 1: 1 Bonus Shares.

Biocon Ltd., Asia’s premier biopharmaceuticals company announced its consolidated financial results for the fourth quarter and fiscal year ended March 31st, 2019.

Commenting on the highlights, Kiran Mazumdar-Shaw, Chairperson & Managing Director, stated “Our Q4 FY19 performance was led by robust growth in our Biologics and Research Services business segments, supported by a significant growth in the Small Molecules business.”

“On an annual basis, our Revenue grew 31% to Rs 5,659 Crore, and Net Profit soared 143% to Rs 905 Crore. FY19 was a landmark year for the Biologics business, which reported a growth of 97%, thus emerging as a key driver for Biocon’s incremental growth. Our three strategic business segments Small Molecules, Biologics and Research Services have reported a top-line of over Rs 1,500 Crore each this fiscal. A higher share of Biologics revenue boosted profitability as reflected in the consolidated EBITDA margin of 27% for the full year despite a 34% increase in Net R&D expenses.

“Looking ahead in FY20, we expect to sustain the growth momentum across our business segments led by biosimilars. We expect to sustain core EBITDA margins despite higher R&D investments to fuel our future growth.”

Highlights: Q4FY19

Ø Biologics revenue nearly doubled, led by biosimilars portfolio performance in developed and emerging markets.
Ø Branded Formulations India business reported a strong double digit growth which was offset by a decline in UAE.
Ø Generic Formulations business grew multi-fold off a low base, reflecting our focus on vertical integration in the Small Molecules business
Ø Research Services subsidiary Syngene crossed the Rs 500 Crore Revenue milestone with a Net Profit milestone of Rs 100 Crore in Q4 on a standalone basis.
Ø To commemorate the 40th anniversary of Biocon Limited the Board recommended the issue of 1 bonus share for every 1 share held in Biocon.

PERFORMANCE REVIEW: Q4FY19

• Biocon’s Total Revenue for Q4FY19 at Rs 1,557 Crore grew by 26% year-on-year (YoY) withRevenue from Operations at Rs 1,529 Crore increasing by 31%.
• EBITDA grew 43% YoY at Rs 431 Crore, with an EBITDA margin of 28% for Q4FY19. Core EBITDA margin for Q4FY19 (net of licensing, impact of forex and R&D) stood at 34%.
• Net Profit for the quarter jumped 64% YoY to Rs 214 Crore, which represents a Net Profit margin of 14%.
• Net R&D expenses for the quarter increased 81% to Rs 92 Crore while Gross R&D expenses stood at Rs 166 Crore, corresponding to 17% of our revenue (excluding Syngene).

Business Segment Review: Q4FY19

The Q4FY19 revenue growth was largely led by a robust performance by Biologics and Research Services, supported by a double digit growth in Small Molecules. The Biologics segment revenue grew 87% to Rs 451 Crore driven by strong sales of our biosimilars Pegfilgrastim and Trastuzumab in developed and emerging markets. Ogivri® (biosimilar Trastuzumab) was launched by our partner Mylan in Europe in Q4. We also launched our biosimilar Trastuzumab in a few more emerging markets this quarter. The product continues to gain traction in key markets of Latin America and AFMET regions.

The Small Molecules business reported a growth of 11% led by a robust performance by Generic Formulations and steady sales of APIs. The strong performance of Generic Formulations was driven by increased traction in Statins sales in the U.S.

The Branded Formulations business, which includes sales in India and UAE, was adversely impacted due to headwinds in UAE. However, the business in India reported a strong performance led by double-digit growth in Metabolics, Critical Care, Immuno therapy and Market Access divisions.

Research Services reported a robust growth of 30% YoY with revenue at Rs 534 Crore on account of sustained growth in the Discovery and Development Services segments. On a standalone basis Syngene crossed the Rs 500 Crore Revenue milestone with a Net Profit milestone of Rs 100 Crore in Q4.

During the quarter, Syngene and the Government of India’s Biotechnology Industry Research Assistance Council (BIRAC) collaborated to set up a Centre for Advanced Protein Studies (CAPS). . The 2000 sq. ft. centre at Syngene’s Bengaluru Campus hosts a state-of-the-art, GLP-accredited analytical laboratory which will be available to BIRAC-funded start-ups, SMEs/MMEs and academia in India at an affordable cost.

PERFORMANCE REVIEW: FULL YEAR FY19

• Biocon’s Total Revenue for FY19 rose 31% to Rs 5,659 Crore with Revenue from Operations growing 34% at Rs 5,514 Crore.
• EBITDA expanded 49% to Rs 1,538 Crore, with an EBITDA margin of 27% for FY19.
• Core EBITDA margin for the year (net of licensing, impact of forex and R&D) stood at 32%.
• Net Profit (including exceptional income*) for the year climbed 143% to Rs 905 Crore.
• Net Profit (excluding exceptional income*) stood at Rs 729 Crore reflecting a stellar growth of 96%.
• Net Profit Margin stood at 16% in FY19 versus 9% in FY18. Net Profit Margin (excluding net exceptional income) was 13% in FY19.
• Net R&D expenses for FY19 grew by 34% to Rs 290 Crore while Gross R&D expenses were Rs 480 Crore, representing 13% of our revenue (excluding Syngene).

* A net exceptional income of Rs 176 Crore related to change in the fair value of our investment in U.S.-based Equillium Inc. was reported in earlier quarters during FY19.