Conference Call with Natco Pharma Management and Analysts on Q4FY20 and Full Year Earnings Performance and Outlook. Listen to the full earnings transcript.
For FY20, NATCO recorded consolidated total revenue of Rs 2,022.4 crore as against Rs 2,224.7 crore, a decline of 9% YoY
The net profit for the period, on a consolidated basis, was Rs 458.1 crore, as against Rs 642.4 crore last year, showing a decline of about 29%
For the fourth quarter ended March 31, 2020, the company recorded a net revenue of Rs 477.2 crore, on a consolidated basis, which is almost flat as compared to Rs 486.7 crore during Q4, FY 2019
The profit after tax, on a consolidated basis, was recorded as Rs 93.2 crore for the quarter, as against Rs 120.4 crore in the same quarter last year
The overall decline in revenue and profits, from prior year, was primarily due to continued decline in Hepatitis C product portfolio and to an extent in oncology segment due to pricing pressures
The company also faced slowdown in business operations during the fourth quarter due to supply chain issues amidst Covid-19 concerns, which were subsequently resolved
Even though lockdown was in the later part of March, a lot of people were uncomfortable coming for treatments to the hospital because there was a risk as most cancer patients have immunosuppression so they could lead to Covid-19 infection. We have seen that it has been playing out in March, April and May and June as well
If you look at the onco portfolio, because of people not coming out, there was an initial fall in sales but things are picking up now specially on the oral onco, the sale has become more stable now. But, we have seen a lot of pressure on the chemo side. People are not coming back at the same level as they used to. The fear of infection continues so there is some pressure in the domestic business especially with the hospital related
There was a pricing pressure for overall 2019-20 but now pricing factor is not involved. It is now Covid-19. There was overall decline full year and the primary reason for the drop in the sale was because of the pricing pressure. The secondary factor playing now is Covid-19 and Covid-19 specifically to the chemo products. Our portfolio has both oral products if you can take it home and chemo products which are taken in hospitals. The oral tablets have sort of rebounded now as it is seeing more stability and things have settled down. But where this is going, I have no idea like no one else. If you ask me if there is lower demand, yes there is lower demand
We have seen a decline of Rs 400 crore but that's a very unusual portfolio. Because of Covid-19, normal people are coming and getting tested because of hospitalisation pressure. The impact is less now. When we were degrowing earlier, impact was more then
Total domestic formulation sale was Rs 540 crore for the year and oncology recorded about Rs 308 crores and the non-onco related recorded Rs 117 crores. CND did about Rs 45 crores which is a significant jump as we had almost zero sales a year and a half ago. We are doing well
About 60-65% revenue stands for oral and 30-35% tends to be chemo, typically as per a rough estimation
For Canada, we are scheduled for a trial in the first week of July
We are anticipating approval shortly for RT PCR. We filed it 9 months ago. I don’t know how much time approval will take but it's doing well. There is nothing much to report on the court case during this time
There is some dependence on China for API but not to that extent. Whatever government has announced in terms of incentives is for specialty chemicals business which we are not in
During this year again, we have an extensive portfolio. We launched about 10 products last year and are planning to launch around 8-10 products this year too. It is a challenging time to launch in Covid-19 as the ability to meet the doctor is limited as all doctors have not come back but we are optimistic that the things will improve except in the containment zones. Overall, I am fairly bullish and expect domestic business should grow but it is little hard to say that how much it will grow