Wockhardt reports Rs139 crore net loss in Q4'08

25 April 2009

Pharmaceutical and biotechnology major Wockhardt Limited has reported a net loss of Rs139 crore for the financial year 2008 (ended 31 December) despite a 35.4 per cent rise in revenue at Rs3,593 crore and a 26.5 per cent rise in operating profit (EBITDA) at Rs808 crore.

Wockhardt's losses were mainly due to a falling rupee while consolidation and rationalisation has also been fully accretive in the results, the company said in a release.

Wockhardt's international business, contributing 73 per cent of the total, grew 40.3 per cent. However, the company suffered mark-to-market losses of Rs581 crore due to steep devaluation of the rupee, the release noted.

The company lost over Rs489 crore due to early termination of certain forex contracts by some of the banks.

''The forex transactions were unilaterally cancelled by the banks and the mark to market losses had arisen on account of counter positions advised by the banks,'' Wockhardt said, adding, ''The company has obtained a legal opinion that these contracts can be disputed, and accordingly no provision for the same has been made.''

''We have had an exceptional year in all ways, both in terms of sales revenues and operating profits. Our acquisitions have started paying-off and have posted double-digit growth in their markets. With 73 per cent of our turnover coming from our international operations, in the normal course of the business, it was prudent to hedge our foreign exchange exposure. But, due to the meltdown in the global markets and the consequent currency volatility, we had to make provisions for MTM losses, which had a marked impact on our bottomline,'' said Wockhardt chairman, Habil Khorakiwala.