Earnings Report: Searle declares EPS Rs3.4 for 3QFY18, down 32 per cent QoQ

LAHORE: Searle Company (SEARL) announced consolidated earnings of Rs626 million, declaring an EPS of Rs3.4, up 53 per cent YoY in 3QFY18.

SEARL’s sales grew by a robust 24 per cent YoY during the outgoing quarter, mainly on the back of higher volumes of the pharmaceutical segment that constitute over 85 per cent of SEARL’s total sales where the performance of SEARL’s biosciences venture remained strong.

The pharmaceutical segment of the company witnessed up to 20 per cent growth in revenues while the consumer segment posted up to 30 per cent growth during 3QFY18.

The company’s gross margins contracted by 1.7 percentage points (ppts) to ~50 per cent, mainly on the back of higher input costs.

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Although distribution expenses were up 5 per cent YoY in 3QFY18, as a percentage of sales, they fell 4ppts to 22 per cent, which supported the company’s bottom-line.

Topline Securities in a note to investors flagged, lower than expected volumetric growth, regulatory and legal issues restricting price increase, delay in introducing new products and higher than anticipated distribution expenses as key risks for SEARL.

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