Pharmaceutical and biotechnology major Wockhardt Limited today announced its results for the year ended 31st December 2008. Wockhardt’s year of consolidation and rationalisation has borne fruit with all its acquisition getting fully accretive. Sales revenues grew by 35.4% to Rs. 3,593 crores and operating profit (EBITDA) was up by 26.5% to Rs. 808 crores. Wockhardt’s international business, contributing 73% of the total, grew 40.3%. However, MTM losses of Rs 581 crores was due to steep duation of the rupee resulting in the company posting a net loss of Rs 139 crores for the financial year 2008.
Some of the banks, based on the early termination clause in the agreement had terminated certain forex contracts and claimed an amount of Rs. 4895.24 million. The Board is of the view the forex transactions were unilaterally cancelled by the banks and the mark to market losses had arisen on account of counter positions advised by the banks. The Company has obtained a legal opinion that these contracts can be disputed, and accordingly no provision for the same has been made.
“We have had an exceptional year in all ways, both in terms of sales revenues and operating profits. Our acquisitions have started paying-off and have posted double-digit growth in their markets. With 73% of our turnover coming from our international operations, in the normal course of the business, it was prudent to hedge our foreign exchange exposure. But due to the meltdown in the global markets and the consequent currency volatility, we had to make provisions for MTM losses, which had a marked impact on our bottomline,” said Wockhardt Chairman, Habil Khorakiwala.
“Wockhardt has applied to its lending banks for Corporate Debt Restructuring (CDR) and the same has been admitted. The passage of this in the coming few months will ensure enough liquidity for operations and mitigate most of our current issues, which in turn will facilitate our planned growth and benefit all our stakeholders,” he further elaborated.
For the fourth quarter of 2008, sales peaked at 24.9% to Rs. 952 crores and operating margin (EBITDA) at 20.6% to Rs. 196 crores. Net loss was Rs. 358 crores.
Wockhardt’s US business, including Morton Grove Pharmaceuticals, grew by 140%. Currently, it markets 65 products in the US and all its manufacturing plants in India are US FDA compliant. Wockhardt was one of the top 5 companies in the world to have received the highest number of 23 Abbreviated New Drug Approvals (ANDAs) by the US FDA for 2008 (source