Renata's revenue growth offset by external factors

Renata Ltd witnessed strong growth in its sales during July of 2022 to March of 2023 though profits fell during the period mainly due to inflation, higher costs of energy, borrowing costs, and foreign exchange losses. 

The major pharmaceutical company's sales grew 8.7 per cent year-on-year to Tk 2,439 crore in the first nine months period of the current financial year of 2022-23, according to its quarterly financial reports. 

Renata witnessed good growth in pharma (6.7 per cent), animal health (11.1 per cent) and export (60.3 per cent).

In the same period, its profits fell 33 per cent to Tk 269 crore while its profits were Tk 405 crore in the same period of the previous year.

"We have observed more encouraging sales growth for Q3 FY22-23 of 14.3% indicating increased momentum predominantly by volume growth as we have taken a very cautious approach on pricing," said Md. Jubayer Alam, company secretary of Renata. 

Additionally, "a government contract secured in March 2022 was expected in March 2023 but this was deferred resulting in a negative impact in Q3 F Y22-23," said Alam. 

"Renata continues to boast a strong financial position with assets of BDT 48.59bn and only BDT 2.41bn of long-term debt. In addition to our existing BDT 14.36bn of fixed assets, we have BDT 15.36bn of Capital Work in Progress relating to expansion projects which will place Renata in a strong position to boost manufacturing capacity supporting future sales growth," said Alam. 

The drug company's earnings per share stood at Tk 23.47 in the July'22 to March'23 period while it was Tk 35.35 in the same period of the previous financial year, data shows. 

Its net asset value per share was Tk 266.8 as on March 31 of 2023 while it was Tk 256.44 as on June 30 of 2022.