Mumbai, May 30, 2023: Hikal Ltd., a preferred long-term partner for leading global life sciences companies, announced its financial results for the quarter and full year ended 31st March 2023.
➢ Hikal’s Panolisite undergone US FDA audit which was concluded with ‘Zero’ 483 observations
➢ Sequential QoQ recovery in margins on back of softening of raw material prices and several operational improvement initiatives
➢ Enhanced efficiencies on account of ongoing business excellence programs across value chain
➢ Pharmaceutical sales was flat and stood at Rs. 309 crore as compared to Rs. 308 crore in Q4 FY22
▪ Improvement in margins on account of business excellence initiatives
▪ Enhanced traction from existing as well as new customers in CDMO business
▪ New multipurpose plant for Animal Health is on track at Panoli, Gujarat and is expected to be completed in H1-FY24
➢ Crop Protection sales grew by 22% at Rs. 236 crore as compared to Rs. 194 crore in Q4 FY22
▪ New opportunities under advance stage of discussion with various global innovators
▪ New multipurpose facility at Panoli, Gujarat is reaching completion; currently stabilizing and commissioning activity is going as per plan
Commenting on the results, Jai Hiremath, Executive Chairman, Hikal Ltd. said,
“For the financial year ’23, we achieved revenue of Rs 2,023 Crores, which is a growth of 4% as compared to last financial year. FY23 has been a challenging year where we witnessed significant headwinds in both our businesses. Despite the challenges we have recorded a sequential quarter-on-quarter growth in profitability.
Our Board of Directors has recommended a final dividend of Rs 0.6 per share (30% of FV). Along with an interim dividend of Rs. 0.6 per share (30% of FV) declared in February 2023, the total dividend for FY23 stands at Rs 1.2 per share (60% of FV). We are pleased to report that during Q4FY23, despite limited top-line growth, we were able to sequentially expand operating margins with efforts put forth by our team to reduce costs and strengthen operational effectiveness.
The Crop Protection business revenue stood at Rs 236 Crores in Q4 FY23 with YoY growth of 22%. We have seen softening of key RM prices and prices are stabilizing. Our multipurpose plant at Panoli is reaching completion and commissioning is underway. The crop protection industry is currently witnessing an inventory correction across the supply chain. We expect the situation to normalize from second half of this year.
For Q4FY23, our pharmaceutical business reported revenues of Rs. 309 Crores. The pharmaceutical industry is facing fierce competition, but price erosion is currently occurring at a slower pace than in the year 2022 suggesting that the worst of the erosion is behind us supported by improved raw material and logistics cost. On the CDMO side, there is a lot of inventory and destocking is taking place. We expect the situation to normalize by the end of Q2. We have a strong future pipeline in our CDMO business and are actively pursuing new opportunities. We have increased our footprint in emerging markets and added several new customers.
I am pleased to inform you our API facility in Panoli, Gujarat, was audited by the US FDA from 8-12 May 2023, and the audit was concluded with ‘Zero’ 483 observations which highlights our high standards of regulatory compliance.
Our new multipurpose facility for animal health is on track and should be operational during H1 FY24. Development of new products as a part of a long-term contract with an innovator animal health company is going as per our plan. One of the key factors that sets us apart is our commitment to sustainability, which is the core of our ESG Strategy. We understand the growing global concern for the environment, and we are working to make a positive impact through our operations. Our investments in technology, waste reduction initiatives, and sustainable manufacturing processes will help position us as a preferred partner for our global customers.
Project Pinnacle initiatives have already begun to yield positive results and will help us emerge stronger, and more sustainable. We foresee a slowdown in the coming couple of quarters due to the global economic downturn and increasing pricing pressure. However, we are focusing on operational excellence and capital efficiency to reduce costs and improve our margins to remain competitive in this challenging global environment. We are well positioned for sustainable growth in the medium to long term, driven by our focus on innovation, commitment to sustainability, global presence, and a strong financial foundation.”