Piramal Enterprises Limited Consolidated Results for the Q3 and 9M FY2017

Mumbai : Piramal Enterprises Limited (‘PEL’, NSE: PEL, BSE: 500302) today announces its consolidated results for the Q3 and 9M FY2017.

Q3 & 9M FY2017 Financial Highlights

• Strong revenue growth during the quarter and the nine months

1. Up 31% at Rs.2,342 Crores during Q3 FY2017 vs. Rs.1,786 Crores in Q3 FY2016


2. Up 30% at Rs.6,084 Crores during 9M FY2017 vs. Rs.4,690 Crores in 9M FY2016

• Operating profit was :

1. 89% higher at Rs.1,085 Crores during Q3 FY2017 vs. Rs.575 Crores in Q3 FY2016


2. 97% higher at Rs.2,467 Crores during 9M FY2017 vs. Rs.1,253 Crores in 9M FY2016

• OPBITDA Margin was :

1. Up at 46% in Q3 FY2017 vs. 32% in Q3 FY2016


2. Up at 41% in 9M FY2017 vs. 27% in 9M FY2016

• Net Profit was :

1. Up 32% at Rs.404 Crores during Q3 FY2017 vs. Rs.307 Crores in Q3 FY2016


2. Up 32% at Rs.941 Crores during 9M FY2017 vs. Rs.712 Crores in 9M FY2016

Q3 FY2017 Operational Highlights

• Global Pharma business acquired a portfolio of intrathecal spasticity and pain management drugs from Mallinckrodt LLC in Jan 2017


• Global Pharma business acquired a portfolio of five injectable anaesthesia & pain management products from Janssen in Oct 2016


• Financial Services business announced its plan to enter the retail housing finance


• Consumer Products revenue grew 28% in Q3, despite demonetization


• Financial Services business launched Flexi Lease Rental Discounting (LRD) for completed commercial assets


• Revenue from Information Management business grew by 9% in Q3, driven by growth across all products and services

Ajay Piramal, Chairman, Piramal Enterprises said, "We are pleased to announce that Piramal Enterprises has delivered superior growth and profitability performance for Q3 and 9M FY2017. In line with our strategic road map, this quarter witnessed new acquisitions, foray into new business segments and robust performance across existing businesses. We remain committed to our overall business strategy of efficiently allocating capital towards growing both organically and inorganically, to consistently create long-term value for our shareholders."

Note: The above financials for Q3 FY2017 and 9M FY2017 are as per new Accounting Standards (Ind AS). Also, the financials for previous period Q3 FY2016 and 9M FY2016 have been reinstated as per new accounting standards to make them comparable with current period.

Consolidated Revenues

Consolidated revenues were 31% higher at Rs.2,342 Crores for Q3 FY2017 and 30% higher at Rs.6,084 Crores for 9M FY2017. 54% of our Q3 FY2017 revenues and 52% of 9M FY2017 revenues were generated in foreign currency.

Operating Profit

Operating profit was 89% higher at Rs.1,085 Crores for Q3 FY2017 and 97% higher at Rs.2,467 Crores for 9M FY2017, primarily driven by strong revenue growth. OPBITDA margin was higher at 46% in Q3 FY2017 and 41% in 9M FY2017.

Net Profit

Net Profit was 32% higher at Rs.404 Crores for Q3 FY2017 and 32% higher at Rs.941 Crores for 9M FY2017. Strong profitability was mainly on account of improved top-line performance, partly offset by increase in interest expense, depreciation and higher tax rate.

Interest Expenses

Interest expense for the Q3 FY2017 and 9M FY2017 was higher primarily on account of increase in debt for making investments under Financial Services business and partly for the acquisitions carried out in Pharma business.

Share of Associates

Income under share of associates primarily includes our share in the profits of Shriram Capital for the period. Our share of profit under JV with Allergan has also now been included under share of profit / loss of Associate, as per the new accounting standards.

Pharma

Revenue from Pharma business was 7% higher at Rs.954 in Q3 FY2017 and 6% higher at Rs.2,679 Crores in 9M FY2017.

Revenue from Global Pharma business was 5% higher at Rs.869 Crores in Q3 FY2017, driven by addition of new products, growth in regulated markets and strong performance in North America due to higher volumes of Sevoflurane and Isoflurane. In 9M FY2017, revenue was 3% higher at Rs.2,414 Crores. We acquired two product portfolios 1) Five injectable anaesthesia & pain management products from Janssen Pharmaceutica and 2) Drugs for Spasticity and Pain Management from Mallinckrodt LLC.

Revenue from India Consumer Products business was 28% higher at Rs.85 Crores for Q3 FY2017 and 44% higher at Rs.265 Crores for 9M FY2017. Despite demonetisation, most brands performed better than expectations. Brands acquired over last few quarters are performing well. During the quarter, we test launched “StopAllerG All Day”, an extension of StopAllerG, in territories of Maharashtra, Delhi and UP. The product is getting good response.

Financial Services

Income from Financial Services was 96% higher at Rs.902 Crores for Q3 FY2017 and 97% higher at Rs.2,352 Crores for 9M FY2017. The growth in income was primarily driven by increase in size of Loan Book. Loan Book grew by 105% to Rs.22,740 Crores as on 31 Dec 2016 vs Rs.11,070 Crores as on 31 Dec 2015. Construction finance accounts for 56% of the total real estate loan book. Gross NPA was at 0.5% as on 31 Dec 2016.

During the quarter, we announced our plan to enter into retail housing finance. We also launched a new product, Flexi Lease Rental Discounting, in our wholesale lending portfolio for completed commercial assets.

SFG loan book grew by 142% to Rs.2,540 Crores as on 31 Dec 2016 vs. Rs.1,050 Crores as on 31 Dec 2015, driven by investment in new sectors like cement, entertainment, services, etc. and introduction of new products like loan against shares, acquisition financing, senior lending and promoter funding.

Gross Assets under Management were at Rs.7,040 Crores. JV with Bain Capital has been operationalized with teams getting on-boarded and deal evaluation already commenced.

Information Management

Revenue from Information Management business was 9% higher at Rs.464 Crores in Q3 FY2017 driven by growth across all products and services. In 9M FY2017, revenue was higher by 5% at Rs.995 Crores. During the quarter, we also launched Consulting Services in Asia. We continue to develop new technology and launch several new platforms to retain top clients and win new business.