Pharmaceuticals company Aarti Drugs announced H1FY25 & Q2FY25 results Q2FY25 Standalone Financial Highlights: Revenue stood at Rs 543.1 crore as against Rs 577.5 crore, down by 6% YoY. Standalone business contributed ~89% to the consolidated revenue for the quarter. ~66% of the revenues came from the domestic market and ~34% from the exports market. Within the API business, the antibiotic therapeutic category contributed ~40%, anti-diabetic ~18%, antiprotozoal ~17%, anti-inflammatory ~10%, antifungal ~10% and the rest contributed ~4% to total API sales Q2FY25 Consolidated Financial Highlights: Revenue stood at Rs 599.8 crore as against Rs 642.2 crore, a decline of 7% YoY. This is on account of lower realizations stemming from negative rate variance and subdued market demand in the API business. EBITDA stood at Rs 68.5 crore as against Rs 77.1 crore, a decline of 11% YoY. EBITDA Margin (%) stood at 11.5%. PAT stood at Rs 35.0 crore as against Rs 39.6 crore, a decline of 12% YoY. PAT Margin (%) stood at 5.8% H1FY25 Consolidated Financial Highlights: Revenue stood at Rs 1,156.3 crore as against Rs 1,303.9 crore, a decline of 11% YoY. EBITDA stood at Rs 134.6 crore as against Rs 161.8 crore, a decline of 17% YoY. EBITDA Margin (%) stood at 11.7%. PAT stood at Rs 68.2 crore as against Rs 87.6 crore, a decline of 22% YoY. PAT Margin (%) stood at 5.9% Adhish Patil, CFO & COO, of Aarti Drugs said: “During Q2FY25, we have seen a drop in revenues and profitability on a year-on-year basis mainly due to lower realizations stemming from negative rate variance and subdued market demand in the API business. The volumes have remained flattish on a YoY basis whereas we have seen a growth of 10% from the last quarter. Since Q1, the prices have stabilized, and volumes have grown which has led to a growth of 8% in revenues on a QoQ basis. We expect pricing to improve going ahead. Formulation segment revenue stood at Rs 65.6 crore for the quarter, with exports contribution of ~53%. In H1FY25 revenue stood at Rs 136.6 crore. The greenfield project at Sayakha, Gujarat for Speciality Chemicals is expected to commence in this quarter. With this, the operating leverage is expected to kick in from the second half of the year with improved capacity utilization. The production of Salicylic Acid has commenced and currently we are producing 100 tonnes per month. There have been certain teething issues, and we expect to ramp up the production to 300+ tonnes by end of October’24. In total we will have sequential ramp up of capacity to 1,800 tonnesthroughout FY25 & FY26. During H1 FY25, the Company has incurred Capex of ~Rs 90 crore mainly towards capacity expansion, backward integration and new product launches. We anticipate a total Capex of ~Rs 200 crore for the full year. This Capex would we mainly through internal accruals and partly through term loans. The Pharma API manufacturing industry is constantly evolving, and we are committed to staying ahead of the curve. We continue to expand our capabilities and enhance our offerings to meet the ever-changing needs of our customeRs We also plan to invest in new technologies and equipment that will help us streamline our processes and improve efficiency.” Result PDF
Conference Call with Aarti Drugs Management and Analysts on Q1FY25 Performance and Outlook. Listen to the full earnings transcript.