Biocon net profit declines 20 per cent

The company has reported a profit of Rs 39 crore for Q1 FY-2006, a 7 per cent dip for the sequential quarter and a 20 per cent dip year-on-year.

Operating profits stayed flat at 30 per cent sequentially, while it dived from 33 per cent for the year-ago period.

The results had its effect on the markets with Biocon shares shedding 3.22 per cent to close at Rs 436.90, over the previous close of Rs 451.45.

The company blamed erosion of prices for statins by as much as 40 per cent over the past few months in the European market for the flat performance. The drop in PAT has been ascribed to a higher tax charge in the quarter and due to reduced treasury income of Rs 2 crore — commensurate with deployment of IPO funds.

‘‘I am satisfied that the overall financial performance is in line with our plan. The pricing pressure in the European markets have affected our percentage margins this quarter,’’ Biocon CMD Kiran Mazumdar Shaw stated.

She, however, indicated a positive outlook for the financial year with Biocon focussing on bio-pharmaceutical like insulin and immuno-suppressants. Subsidiaries Syngene and Clinigene will also contribute to growth this year with new research contracts, Shaw said. The subsidiaries posted a 35 per cent year-on-year growth for Q1 of FY-2006 and matched numbers for Q4 of FY-2005.

‘‘The outlook for the year ahead remains positive. New growth drivers like insulin, immuno-suppressants and branded formulations are building the bio-pharmaceuticals business in a robust manner and reducing dependence on statins. New research contracts both at Syngene and Clinigene will deliver additional growth,’’ she said.

Biocon’s oral insulin product is on track and set to file for an Investigational New Drug Application with the USFDA by year end, Shaw indicated.