Lupin Q3 profit misses estimates, dips 65% on lower sales in North America, forex losses
Indian drugmakers have struggled with weak sales in the United States on account of regulatory bans and warnings over quality control violations at production plants.Updated: Feb 06, 2018 16:32 IST
Lupin Ltd, the country’s second-largest drugmaker by revenue, reported lower-than-expected third-quarter earnings on Tuesday, hurt by lower sales in North America and foreign exchange losses.
Profit fell 65% to 2.22 billion rupees for the quarter ended Dec. 31, well below an average analysts’ estimate of 4.21 billion rupees, Thomson Reuters data showed.
Indian pharmaceutical companies have struggled with weak sales in the United States on account of regulatory bans and warnings over quality control violations at production plants.
Sales have also been hit by pricing pressures on account of rising competition in the generics market in the U.S.
Lupin said its sales in North America, which accounts for more than a third of its total sales, fell 34% to 14.32 billion rupees ($223.29 million). Net sales slipped 11.5% to 39 billion rupees.
“The quarterly performance was muted on the back of business mix as well as forex losses,” said Nilesh Gupta, managing director, Lupin.
Lupin said its profit was hit by a foreign exchange loss of 821 million rupees compared to a gain of 276 million rupees a year earlier.
The company also incurred a charge of 361 million rupees as a result of recalculating deferred tax assets related to its United States operations due to the introduction of a new tax regime.
Lupin Ltd’s shares closed at 790.05 rupees on Tuesday, lower by 6.95%.