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DR. REDDY'S LABORATORIES LTD. Investor relationS Media relationS 8-2-337, Road No. 3, Banjara Hills, Hyderabad - 500034. Telangana, India. Richa Periwal richaperiwal@drreddys.com AISHWARYA SITHARAM aishwaryasitha

Tuesday, January 30, 2024 5 min read
Key Takeaway: CONTACT DR. REDDY'S LABORATORIES LTD. Investor relationS Media relationS 8-2-337, Road No. 3, Banjara Hills, Hyderabad - 500034. Telangana, India. Richa Periwal richaperiwal@drreddys.com AISHWARYA SITHARAM aishwaryasitharam@drreddys.com USHA IYER ushaiyer@drreddys.com Reddy's Q

Full Press Release Details

CONTACT
DR. REDDY'S LABORATORIES LTD. Investor relationS Media relationS
8-2-337, Road No. 3, Banjara Hills, Hyderabad - 500034. Telangana, India. Richa Periwal richaperiwal@drreddys.com AISHWARYA SITHARAM aishwaryasitharam@drreddys.com USHA IYER ushaiyer@drreddys.com
Reddy's Q3 & 9M FY24 Financial Results
India, January 30, 2024: Dr. Reddy's Laboratories Ltd. (BSE: 500124 | NSE: DRREDDY | NYSE: RDY | NSEIFSC: DRREDDY) today announced
its consolidated financial results for the quarter and nine months ended December 31, 2023. The information mentioned in this release
is based on consolidated financial statements under International Financial Reporting Standards (IFRS).
Q3FY24 9MFY24
Revenues Rs. 72,148 Mn Rs. 208,334 Mn
[Up: 7% YoY; Up: 5% QoQ] [Up: 14% YoY; Up]
Gross Margin 58.5% 58.6%
[Q3FY23: 59.2%; Q2FY24: 58.7%] [9M FY23: 56.5%]
SG&A Expenses Rs. 20,228 Mn Rs. 56,725 Mn
[Up: 12% YoY; 8% QoQ] [Up: 13% YoY]
R&D Expenses Rs. 5,565 Mn Rs. 15,996 Mn
[7.7% of Revenues] [7.7% of Revenues]
EBITDA Rs. 21,107 Mn Rs. 64,278 Mn
[29.3% of Revenues] [30.9% of Revenues]
Profit before Tax Rs. 18,257 Mn Rs. 55,854 Mn
[Up: 12% YoY; Down: 5% QoQ] [Up: 19% YoY]
Profit after Tax Rs. 13,789 Mn Rs. 42,614 Mn
[Up: 11% YoY; Down: 7% QoQ] [Up: 20% YoY]
on the results, Co-Chairman & MD, G V Prasad said: "We delivered another quarter of highest-ever sales and robust
financial performance aided by new products performance and base business market share gain in the U.S., new products launch momentum
and strong performance in Europe. We continue to strengthen our core businesses and invest in innovative products including strategic
collaborations for novel molecules to meet unmet needs of patients."
Reddy's Laboratories Limited & Subsidiaries
Mix by Segment [Q3FY24]
Q3FY24 Q3FY23 YoY Q2FY24 QoQ
Particulars (Rs.) (Rs.) Gr % (Rs.) Gr%
Global Generics 63,095 59,241 7 % 61,084 3 %
North America 33,492 30,567 9 % 31,700 5 %
Europe 4,970 4,303 15 % 5,286 -6 %
India 11,800 11,274 5 % 11,860 -1 %
Emerging Markets 12,833 13,097 -2 % 12,163 6 %
Pharmaceutical Services and Active Ingredients (PSAI) 7,839 7,758 1 % 7,034 11 %
Others 1,214 701 73 % 684 78 %
Total 72,148 67,700 7 % 68,802 5 %
Revenue Mix by Segment [9M FY24]
9MFY24 9MFY23 YoY
Particulars (Rs.) (Rs.) Gr%
Global Generics 184,262 159,511 16 %
North America 97,245 76,383 27 %
Europe 15,326 12,644 21 %
India 35,141 36,113^ -3 %
Emerging Markets 36,550 34,371 6 %
Pharmaceutical Services and Active Ingredients (PSAI) 21,582 21,282 1 %
Others 2,490 2,119 18 %
Total 208,334 182,911 14 %
^ includes divestment income in India in Q1FY23, excluding which
India YoY growth is at 4% and total company growth is at 15%
Consolidated Income Statement [Q3FY24]
Q3FY24 Q3FY23 YoY Q2FY24 QoQ
Particulars ($) (Rs.) ($) (Rs.) Gr % ($) (Rs.) Gr%
Revenues 867 72,148 814 67,700 7 827 68,802 5
Cost of Revenues 360 29,945 332 27,607 8 342 28,434 5
Gross Profit 507 42,203 482 40,093 5 485 40,368 5
% of revenues 58.5 % 59.2 % 58.7 %
Operating Expenses
Selling, General & Administrative expenses 243 20,228 216 17,981 12 226 18,795 8
% of revenues 28.0 % 26.6 % 27.3 %
Research & Development expenses 67 5,565 58 4,821 15 65 5,447 2
% of revenues 7.7 % 7.1 % 7.9 %
Impairment of non-current assets 1 110 2 134 (18 ) 1 55 100
Other operating (income)/expense (12 ) (967 ) 9 732 (232 ) (22 ) (1796 ) (46 )
Results from operating activities 208 17,267 197 16,425 5 215 17,867 (3 )
Net finance (income)/expense (12 ) (963 ) 2 139 (793 ) (15 ) (1225 ) (21 )
Share of profit of equity accounted investees, net of tax (0 ) (27 ) (1 ) (60 ) (55 ) (1 ) (42 ) (36 )
Profit before income tax 219 18,257 196 16,346 12 230 19,134 (5 )
% of revenues 25.3 % 24.1 % 27.8 %
Income tax expense 54 4,468 47 3875 15 52 4,334 3
Profit for the period 166 13,789 150 12,471 11 178 14,800 (7 )
% of revenues 19.1 % 18.4 % 21.5 %
Diluted Earnings Per Share (EPS) 0.99 82.68 0.90 74.95 10 1.07 88.78 (7 )
Q3FY24 Q3FY23 Q2FY24
Particulars ($) (Rs.) ($) (Rs.) ($) (Rs.)
Profit before Income Tax 219 18,257 196 16,346 230 19,134
Interest (income) / expense - Net* (12 ) (1,030 ) (1 ) (93 ) (14 ) (1,166 )
Depreciation 29 2,437 27 2,245 29 2,437
Amortization 16 1,333 12 1,026 16 1,353
Impairment 1 110 2 134 1 55
EBITDA 254 21,107 236 19,658 262 21,813
% of revenues 29.3 % 29.0 % 31.7 %
Income Statement [9MFY24]
9MFY24 9MFY23 YoY
Particulars ($) (Rs.) ($) (Rs.) Gr %
Revenues 2,504 208,334 2,199 182,911 14
Cost of Revenues 1,036 86,210 956 79,565 8
Gross Profit 1,468 122,124 1,242 103,346 18
% of revenues 58.6 % 56.5 %
Operating Expenses
Selling, General & Administrative expenses 682 56,725 601 50,034 13
% of revenues 27.2 % 27.4 %
Research & Development expenses 192 15,996 168 14,015 14
% of revenues 7.7 % 7.7 %
Impairment of non-current assets 2 176 2 159 11
Other operating (income)/expense (43 ) (3,543 ) (68 ) (5,626 ) (37 )
Results from operating activities 634 52,770 538 44,764 18
Net finance (income)/expense (36 ) (2,972 ) (25 ) (2,054 ) 45
Share of profit of equity accounted investees (1 ) (112 ) (4 ) (294 ) (62 )
Profit before income tax 671 55,854 566 47,112 19
% of revenues 26.8 % 25.8 %
Income tax expense 159 13,240 140 11,637 14
Profit for the period 512 42,614 426 35,475 20
% of revenues 20.5 % 19.4 %
Diluted Earnings Per Share (EPS) 3.07 255.68 2.56 213.24 20
9MFY24 9MFY23
Particulars ($) (Rs.) ($) (Rs.)
Profit before Income Tax 671 55,854 566 47,112
Interest (income) / expense - Net* -35 -2,881 1 52
Depreciation 86 7,155 77 6,402
Amortization 48 3,974 37 3,045
Impairment 2 176 2 159
EBITDA 773 64,278 682 56,769
% of revenues 30.9 % 31.0 %
Key Balance Sheet Items
As on 31 st Dec 2023 As on 30 th Sep 2023 As on 31 st Dec 2022
Particulars ($) (Rs.) ($) (Rs.) ($) (Rs.)
Cash and cash equivalents and other investments 922 76,665 839 69,784 603 50,164
Trade receivables 943 78,417 838 69,722 902 75,046
Inventories 731 60,796 680 56,592 593 49,326
Property, plant, and equipment 875 72,795 847 70,478 781 64,996
Goodwill and Other Intangible assets 495 41,192 496 41,278 426 35,401
Loans and borrowings (current & non-current) 239 19,851 159 13,230 212 17,663
Trade payables 374 31,113 366 30,485 313 26,023
Equity 3,220 267,850 3,042 253,086 2,648 220,273
Key Business Highlights [Q3FY24]
ESG & other Highlights [Q3FY24]
Revenue Analysis [Q3FY24]
Global Generics (GG)
Pharmaceutical Services and Active Ingredients
Income Statement Highlights:
About key metrics and non-GAAP Financial Measures
This press release contains non-GAAP financial
measures within the meaning of Regulation G and Item 10(e) of Regulation S-K. Such non-GAAP financial measures are measures of our historical
performance, financial position or cash flows that are adjusted to exclude or include amounts from the most directly comparable financial
measure calculated and presented in accordance with IFRS.
The presentation of this financial information
is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented
in accordance with IFRS. Our non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles. These
measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparison purposes.
We believe these non-GAAP financial measures provide
investors with useful supplemental information about the financial performance of our business, enable comparison of financial results
between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key
metrics used by management in operating our business.
For more information on our non-GAAP financial
measures and a reconciliation of GAAP to non-GAAP measures, please refer to "Reconciliation of GAAP to Non-GAAP Results"
table in this press release.
All amounts in millions, except EPS
Reconciliation of GAAP measures to non-GAAP measures
Three months ended Dec. 31, 2023
Particulars (Rs.)
Net cash generated from operating activities 10,762
Less:
Taxes 6027
Investments in PPE and Intangibles 4518
Free Cash Flow 217
Operating working capital
As on 31 st Dec 2023
Particulars (Rs.)
Inventories 60,796
Trade Receivables 78,417
Less:
Trade Payables 31,113
Operating Working Capital 108,100
As on 31 st Dec 2023
Particulars (Rs.)
Cash and cash equivalents 7,535
Investments 69,130
Short-term borrowings (12,343 )
Long-term borrowings, non-current (6,152 )
Less:
Restricted cash balance - Unclaimed dividend 122
Lease liabilities (included in Long-term borrowings, non-current) (2,352 )
Equity Investments (Included in Investments) 1328
Net Cash Surplus 59,072
Computation of Return on Capital Employed
As on 31 st Dec 2023
Particulars (Rs.)
Profit before tax 18,257
Less:
Interest and Investment Income (Excluding forex gain/loss) 1,030
Earnings Before Interest and taxes [A] 17,227
Average Capital Employed [B] 191,125
Annualized Return on Capital Employed (A/B) (Ratio) 37 %
Computation of capital employed
Year Ended
Particulars Dec 31, 2023 Mar 31, 2023
Property Plant and Equipment 72,795 66,462
Intangibles 36,905 30,849
Goodwill 4,287 4,245
Investment in equity accounted associates 4,218 4,702
Other Current Assets 23,512 20,069
Other investments 4,115 660
Other non-current assets 1,128 800
Inventories 60,796 48,670
Trade Receivables 78,417 72,485
Derivative Financial Instruments -16 1,095
Less:
Other Liabilities 43,159 42,320
Provisions 5,394 5,513
Trade payables 31,113 26,444
Operating Capital Employed 206,491 175,760
Average Capital Employed 191,125
Computation of EBITDA
Refer page no. 3 & 4.
Earnings Call Details
The management of the Company will host an Earnings call to discuss
the Company's financial performance and answer any questions from the participants.
Date: January 30, 2024
Time: 19:30 pm IST | 10:00 am EDT
Option 1: Pre-register with the below link and join without waiting for the operator
https://services.choruscall.in/DiamondPassRegistration/register?confirmationNumber=1745002&linkSecurityString=a262ce748
Option 2: Join through below Dial-In Numbers
Universal Access Number: +91 22 6280 1219 +91 22 7115 8120
International Toll-Free Number: USA: 1 866 746 2133 UK: 0 808 101 1573 Singapore: 800 101 2045 Hong Kong: 800 964 448
No password/pin number is necessary to dial in to any of the above
numbers. The operator will provide instructions on asking questions before and during the call.
Play Back: The play back will be available after the earnings
call, till February 6th, 2024. For play back dial in phone No: +91 22 7194 5757, and Playback Code is 61003.
Transcript: Transcript of the Earnings call will be available
on the Company's website: www.drreddys.com
About Dr. Reddy's: Dr. Reddy's Laboratories Ltd.
(BSE: 500124, NSE: DRREDDY, NYSE: RDY, NSEIFSC: DRREDDY) is a global pharmaceutical company headquartered in Hyderabad, India. Established
in 1984, we are committed to providing access to affordable and innovative medicines. Driven by our purpose of Good Health Can't
Wait', we offer a portfolio of products and services including APIs, generics, branded generics, biosimilars and OTC. Our major
therapeutic areas of focus are gastrointestinal, cardiovascular, diabetology, oncology, pain management and dermatology. Our major markets
include - USA, India, Russia & CIS countries, China, Brazil, and Europe. As a company with a history of deep science that has
led to several industry firsts, we continue to plan and invest in businesses of the future. As an early adopter of sustainability and
ESG actions, we released our first Sustainability Report in 2004. Our current ESG goals aim to set the bar high in environmental stewardship;
access and affordability for patients; diversity; and governance. For more information, log on to: www.drreddys.com.
Disclaimer: This press release may include statements of future
expectations and other forward-looking statements that are based on the management's current views and assumptions and involve known
or unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or
implied in such statements. In addition to statements which are forward-looking by reason of context, the words "may", "will",
"should", "expects", "plans", "intends", "anticipates", "believes", "estimates",
"predicts", "potential", or "continue" and similar expressions identify forward-looking statements. Actual
results, performance or events may differ materially from those in such statements due to without limitation, (i) general economic conditions
such as performance of financial markets, credit defaults , currency exchange rates , interest rates , persistency levels and frequency
/ severity of insured loss events (ii) mortality and morbidity levels and trends, (iii) changing levels of competition and general competitive
factors, (iv) changes in laws and regulations and in the policies of central banks and/or governments, (v) the impact of acquisitions
or reorganization , including related integration issues, and (vi) the susceptibility of our industry and the markets addressed by our,
and our customers', products and services to economic downturns as a result of natural disasters, epidemics, pandemics or other
widespread illness, including coronavirus (or COVID-19), and (vii) other risks and uncertainties identified in our public filings with
the Securities and Exchange Commission, including those listed under the "Risk Factors" and "Forward-Looking Statements"
sections of our Annual Report on Form 20-F for the year ended March 31, 2023. The company assumes no obligation to update any information
contained herein." The company assumes no obligation to update any information contained herein.
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Last updated: Jan 30, 2024