CIPLA: profit soars on ARV exports

April 22, 2004

Cipla Q4 profit soars on exports, partner payments

BOMBAY (Reuters) - Drug firm Cipla Ltd announced on Wednesday a

doubling of fourth quarter net profit, far exceeding market

expectations, boosted by higher exports and payments from foreign

partners.

Cipla shares rose as much as 6.5 percent to 1,331 rupees, before

closing off its highs at 1,310 rupees.

Its January-March net profit rose 118 percent to 1.02 billion rupees

from 467.3 million a year earlier. Sales rose 44 percent to 5.5

billion rupees. A Reuters poll of 11 analysts had forecast a net

profit of 765 million rupees on sales of 4.8 billion.

Cipla said in a statement its exports had risen 55 percent with sales

of anti-asthmatics, anti-AIDS, anti-depressants and cardiovascular

drugs doing very well.

Exports accounted for 52 percent of sales, though domestic market

sales also rose a healthy 34 percent, it said.

Sales in the fourth quarter of the previous year had been depressed

by an Indian truckers' strike and some confusion among stockists over

the introduction of value-added tax.

Cipla also reported a huge jump in other operating income to 533.7

million rupees from just 85.2 million a year earlier. This came from

payments it received for product development from various foreign

partners and also from higher export incentives.

The company's strategy for tapping overseas markets includes

supplying active ingredients to foreign firms and also co-developing

generics for them.

Rivals like Ranbaxy Laboratories and Dr. Reddy's Laboratories mostly

develop the generics on their own and sell either directly or through

partners.

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