Syngene Q4 results: Net profit up 6% to Rs 189 cr, revenue down 8%

Biocon arm Syngene International reported profit after tax of Rs 189 crore (before exceptional items), up six percent year-on-year for the fourth quarter of fiscal 2024. Reported operating income for the fourth quarter fell by eight percent year-on-year to Rs 917 crore.

Syngene International reported earnings before interest, taxes, depreciation and amortization (Ebitda) of Rs 333 crore in Q4 2424, up from Rs 337 crore year-on-year.

“Although fourth quarter performance was lower than expected, the underlying factor – reduced demand for research and development services within US biotechnology due to a difficult financing environment – ​​is well understood and is already showing positive signs of recovery,” says Jonathan Hunt, Manager Director and CEO of Syngene International Limited.

Additionally, Syngene expressed optimism about the recent influx of funding into the US biotech sector. Anticipating a resulting increase in demand for research and development services, the company expects revenue growth in the second half of the year.

“We expect revenue growth in fiscal 2025 to be in the high single digits to low double digits, with momentum building over the year. We expect Ebitda margin to be comparable to fiscal 2024 levels and profit after tax to grow in the single digits. The long-term indicators for the sector are positive and I am confident that we will continue to perform well in the long term,” said Hunt.

“We had a strong start to the year, which weakened in the third and fourth quarters, resulting in a slower second half of the fiscal year. We continued to proactively manage costs to achieve consistent operating leverage and maintain Ebitda margin around expected levels. Our net cash generated from operations during the year was strong at Rs 1,042 crore, fully financing capital expenditure and the acquisition of the biologics manufacturing plant,” said Sibaji Biswas, Chief Financial Officer and Executive Director of Syngene International.

In development services, a new capability for purifying and separating chiral compounds and highly potent active pharmaceutical ingredients (HPAPIs) was operationalized. HPAPIs are typically used in the treatment of serious diseases such as cancer, where accurate dosing is crucial. By offering purification and separation in-house, customers benefit from access to everything from initial synthesis to final purification in a single, seamless process.

The acquisition of Stelis Biopharma’s production facility for biological medicines in Manufacturing Services has been successfully completed. The repurposing efforts are progressing as planned, with qualification and facility modifications expected to be completed in the second half of 2024. Once completed, the facility will facilitate the production of both pharmaceuticals and pharmaceuticals.

Syngene continued to invest in its fully integrated therapeutic discovery and development for small molecules and biologics, SynVent, which covers a range of therapeutic areas including oncology, gene therapy, central nervous system (CNS) and pain management for use in human and animal health.

Shares of Syngene International closed the day’s trading on BSE at Rs 694.2 apiece, down one percent.

First print: April 25, 2024 | 12:43 pm IST