India’s Glenmark Pharma Q1 profit drops on higher expenses

BENGALURU (Reuters) – India’s Glenmark Pharmaceuticals Ltd reported a 22% decline in quarterly profit on Friday, hit by higher expenses and a one-time cost.

Consolidated net profit fell to 1.50 billion rupees ($18.12 million) for the three months ended June 30, from 1.93 billion rupees a year ago, the cetrizine maker said.

Glenmark, which caters to therapeutic areas such as diabetes, cardiovascular and oral contraceptives, reported a 19% rise in total expenses to 30.37 billion rupees. This included a 86.7% spike in finance costs.

Expenses also increased due to a one-time cost of 520.2 million rupees spent during the quarter for repairs at its various manufacturing facilities in India and the United States.

The company’s India drugs segment, which accounted for about 31% of total sales, rose by 2.8%, while its North America business, which contributed 23.8%, grew 22%. This helped net sales rise 22.6% to 33.36 billion rupees.

Last quarter, the company’s revenue was hurt due to a lower demand in its India business.

Glenmark’s rivals Dr Reddy’s Laboratories and Cipla had posted higher profits last month on stronger sales.

Last month, unit Glenmark Lifesciences Ltd had posted a near 25% rise in first-quarter profit, helped by growth in its active pharma ingredient business.

Shares of the Mumbai-based company settled 1.1% lower on Friday ahead of its results. Glenmark Pharmaceuticals’ shares had climbed 45.5% in the April-June quarter, outperforming the Nifty Pharma index that rose 14.6%.

($1 = 82.7960 Indian rupees)

(Reporting by Biplob Kumar Das in Bengaluru; Editing by Shailesh Kuber)