Top-line of the company increased to Rs 8457.99 mn in FY10 as against Rs 7279.68 mn (increase of 16.18%) in the previous year.

The EBITDA expanded by 47.25% Y-O-Y to Rs.2143.47mn. (surpassing our research expectations of Rs 2082.3mn).
The net profit improved by 69.09% Y-o-Y to Rs.922.89mn. (In line with our research estimation of Rs 941.14mn)

COMPANY PROFILE

Nectar Lifesciences Ltd (NecLife) is a 200 million US$ integrated pharmaceutical organization, offering comprehensive range of Cephalosporin Active Pharmaceutical Ingredients and Finished Dosage Forms. The development and manufacture of quality intermediates, bulk actives makes them one of the largest manufacturers of cephalosporin ranges of products. It delivers innovative and affordable products to domestic as well as international markets.

It has 11 manufacturing facilities – 8 in Derabassi, Punjab (API and Menthol units), 2 in Baddi, Himachal Pradesh (FDF and EHGC plants) and one in Jammu (Menthol Plant)

Net sales for the quarter increased to Rs. 2,416.7 million compared to Rs. 1,722.9 million in Q4 FY2009; an increase of 40.3% primarily led by the growth in the API segment in both domestic and  international markets. EBIDTA for the quarter increased by 95.6% at Rs. 624.6 million compared to Rs. 319.3 million in the corresponding period last year.

EBIDTA margins increased to 25.3% compared to 17.5% in the corresponding quarter last year due to the Company’s enhanced focus on the high growth high margin pharmaceutical business. Depreciation for the quarter was higher at Rs. 94.6 million as against Rs. 71.5 million in the Q4 FY2009 due to additional CAPEX of Rs. 1500 mn incurred on new API facility. Interest cost for the quarter increased 22.6% to Rs. 197.2 million as compared to Rs. 160.9 million due to debt raised by the company during the last year to fund its capex plans.

Pharmaceuticals division contributed Rs. 1970.4 million, 79.89% of total sales in Q4FY10 from Rs. 1332.6 million in Q4FY09 (increase of 47.9%) where Phytochemicals vertical contribute 20.1% towards total sales at Rs. 495.9 million from Rs. 494.4 million (increase of 0.3%).

During the year ended 31st March, 2010, the company reported net sales of Rs 8457.99 mn in FY10 as against Rs 7279.68 mn in the previous year (increase of 16.18%). Total Revenues for FY10 stood at Rs 8651.95 mn as against Rs 8689.4mn during the corresponding last year. The decrease is mainly due to decrease in stock trade of Rs 93.95 mn in FY10 where there is increase in stock trade of 73.42 mn in FY09 (change of 127.9%).

Pharmaceuticals division contributed Rs. 7011.8 million, 79.2% of total sales in FY10 from Rs. 5795.4 million in FY09 (increase of 21%) where Phytochemicals vertical contribute 20.8% towards total sales at Rs. 1846.37 million from Rs.2,004.4 million (decrease of 7.8%).

The operating performance of the company reported an increase of 47.25% YoY to Rs 2143.47mn as against Rs 1455.7mn. The Operating Profit Margins of the company improved due to higher price realization in API’s and Formulations where it is 20-30% higher in semi-regulated markets and 50-70% higher in regulated markets than its existing geographies. The OPM improved by 561bps to 24.77% as against 19.16% during similar period last year.

The bottom-line of the company expanded by an impressive 69.09% Y-o-Y to Rs 922.89mn as against Rs 545.8mn during the last year, this is mainly due to improved operating profit margins.