Sun Pharma Q4 Results: Net Profit Slumps 52% On Lower Other Income, Taro Operating Loss

Sun Pharmaceutical Industries Ltd.’s quarterly profit fell by more than half as sales and other income declined, and its U.S. arm reported an operating loss.

U.S. Subsidiary Highlights (QoQ)

• Sales from its U.S. subsidiary, Taro Pharmaceutical Industries, rose 6% to $148.3 million.
• Gross profit rose 5.05% to $76.9 million, and comprised nearly 51.9% of the net sales in the reported quarter against 52.2% in the preceding three months.
• Taro reported an operating loss of $41.9 million against an operating income of $36.3 million in the preceding quarter.
• This operating loss is on account of settlements and contingencies of $80 million, reflecting additional legal provisions for ongoing multi-jurisdiction civil antitrust matters, according to its filing.
• Excluding the settlement and contingencies, Taro reported an operating income of $38.1 million.

Other highlights (QoQ)

• Sun Pharma’s sales from India business fell 3% to Rs 26,70.9 crore.
• The U.S. finished dosage sales fell 1% to $370 million.
• The U.S. business accounted for 32% of Sun Pharma’s consolidated sales.
• Emerging market sales fell 6% to $192 million.
• Rest of the world sales fell 6% to $163 million.

“FY21 was a year marked by a highly volatile business environment due to the global Covid-19 pandemic and lockdowns in various countries. Despite these challenges, we have been able to maintain business continuity and record positive overall growth,” Managing Director Dilip Shanghvi was quoted as saying in a media statement. “While our India business continues to outperform the average industry growth, our global specialty sales have shown an improving trend. Global Ilumya (used to treat adults with moderate to severe plaque psoriasis) sales for the year have grown 51% to $143 million.”

Meanwhile, the board has proposed a final dividend of Rs 2.0 per share for FY21, in addition to an interim dividend of Rs 5.50 apiece declared on Jan. 29, 2021.

Shares of Sun Pharma closed 0.7% lower before the results were announced compared with a 0.24% gain in the benchmark Nifty 50.