Company Overview:
Wanbury Ltd., established in 1988, is a prominent player in the pharmaceutical industry. The company has a strong presence in the global API market and domestic branded formulations, exporting its products to over 50 countries. Wanbury’s manufacturing facilities, located in Patalganga (Maharashtra) and Tanuku (Andhra Pradesh), are approved by USFDA and EUGMP. The company’s diverse product portfolio includes APIs like Metformin, Sertraline, Tramadol, and Paroxetine, among others. Wanbury also has a significant presence in various therapeutic categories such as cough and cold solutions, gastro-intestinal treatments, and anti-inflammatory and analgesics.
Financial Performance Overview:
Wanbury’s financial performance for Q1FY25 reflects the challenges the company faced during the quarter. The company reported revenues of ₹131.11 Crores, a 10.38% decline compared to ₹146.29 Crores in Q1FY24. This significant decrease in revenue can be attributed to operational inefficiencies, particularly at the Patalganga manufacturing facility, which was undergoing upgradation and renovation during the quarter. The facility’s underutilization impacted production levels, leading to reduced sales.
In terms of expenses, Wanbury managed to reduce its total expenses to ₹131.01 Crores in Q1FY25 from ₹141.91 Crores in Q1FY24, marking a 7.68% decrease. While this reduction in costs partially mitigated the impact of the lower revenue, it was not sufficient to prevent a sharp decline in profitability. The company’s EBITDA for the quarter stood at ₹11.9 Crores, with an EBITDA margin of 9.1%, slightly lower than the 9.5% margin recorded in the previous year. The decline in operational efficiency, combined with lower revenue, resulted in a significant drop in profit after tax (PAT) to ₹1.04 Crores, a 77.83% decrease from ₹4.69 Crores in Q1FY24. Consequently, the PAT margin also contracted to 0.8% from 3.2% in the same period last year.
Despite these financial challenges, Wanbury achieved a major operational milestone by successfully clearing the USFDA inspection at its Patalganga facility for the sixth time, with zero-483 observations. This accomplishment underscores the company’s ongoing commitment to quality and regulatory compliance, even during a period of operational difficulties. Additionally, the company made strategic leadership changes, appointing Mr. V. Prakash as the Head of API business, a move aimed at driving future growth and enhancing the company’s strategic direction.
Looking ahead, Wanbury is expected to recover as it resumes full-scale operations at its key facilities and implements its strategic initiatives. The company’s focus on cost reduction, efficiency improvements, and leadership changes positions it to enhance profitability in the subsequent quarters.