Syngene International Limited, a leading contract research organization, has reported a substantial decrease in its export performance for the second quarter of the fiscal year 2024. The company, known for its integrated research, development, and manufacturing services, experienced a notable downturn in its international business.

Key Highlights

• Overall Export Decline: Syngene's exports fell by 35.00% during the September quarter compared to the same period last year.
• Sharp September Slump: The company witnessed a steeper 52.00% decrease in exports specifically for the month of September.

Export Performance Overview

This significant drop in export performance could have various implications for Syngene International's overall financial health and market position. The sharp decline, particularly in September, may indicate challenges in the global market or specific issues affecting the company's international operations.

While the reasons for this export slump have not been detailed in the available information, such a substantial decrease could be attributed to various factors, including global economic conditions, changes in international regulations, or shifts in demand for the company's services in key markets.

Investors and market analysts will likely be keen to understand the underlying causes of this export decline and any measures Syngene International plans to implement to address this challenge. The company's future guidance and strategies to mitigate the impact of reduced exports will be crucial for stakeholders to assess Syngene International's long-term prospects in the competitive contract research and manufacturing sector.

Syngene International Limited , a leading contract research organization, has reported strong financial results for the first quarter. The company's performance demonstrates robust growth and improved profitability.

Financial Highlights

• Revenue from operations increased by 11% year-on-year to Rs. 875.00 crores
• Reported EBITDA grew by 19% to Rs. 224.00 crores
• EBITDA margin improved to 25% from 23% in the same quarter last year
• Reported Profit After Tax (PAT) surged by 59% to Rs. 87.00 crores

Revenue and Profitability

Syngene's revenue from operations for the quarter stood at Rs. 875.00 crores, marking an 11% increase from Rs. 790.00 crores in the corresponding quarter of the previous year. This growth was primarily driven by the continued conversion of pilot programs into longer-term contracts within the company's Research Services business.

The company's reported EBITDA saw a significant rise of 19%, reaching Rs. 224.00 crores. The EBITDA margin also improved, increasing from 23% to 25%, reflecting enhanced operational efficiency and cost management.

Profit After Tax (PAT) showed remarkable growth, increasing by 59% to Rs. 87.00 crores compared to Rs. 54.00 crores in the same quarter of the previous year. The substantial increase in PAT can be attributed to revenue growth, improved operational performance, and a focus on cost optimization.

Operational Highlights

Syngene made notable progress in various operational areas during the quarter:

1. Successfully completed a USFDA Good Clinical Practices inspection with no observations.
2. Inaugurated a new peptide laboratory, expanding its scientific platform capabilities.
3. Started operations at its Unit III facility in Bengaluru.
4. Advanced preparations to commence operations at the Bayview facility in the U.S. later this year.

Management Commentary

Peter Bains, Managing Director and CEO of Syngene International Limited, commented on the results: "We are pleased with the growth performance in the first quarter, which is aligned with our expectations. Continued conversion of pilot programs into longer-term contracts within our Research Services business was the main driver underpinning this momentum."

Deepak Jain, Chief Financial Officer, added: "Operating EBITDA margins came at around 24%, driven by both revenue growth and a focus on cost optimization. The current quarter's PAT includes a tax benefit arising from transfer of gratuity funds to Employee Gratuity Trust."

Recognition and Sustainability

Syngene was recognized by TIME magazine and Statista as one of the World's Most Sustainable Companies. The company ranked #1 in India among companies in the pharma and biotech sectors and was placed in the top 20 life science companies globally.

Key Management Personnel Update

The company has updated its list of Key Managerial Personnel authorized to determine materiality of events:

1. Peter Bains - Managing Director and CEO
2. Deepak Jain - Chief Financial Officer
3. Chethan Yogesh - Company Secretary and Compliance Officer

Outlook

While remaining mindful of ongoing macroeconomic factors, Syngene's management maintains a confident outlook for the future. The company continues to invest in technology and capabilities to strengthen its customer offerings and remains on course to deliver in line with its stated guidance for the year.

Syngene International Limited's strong start to the fiscal year demonstrates its resilience and ability to grow in a challenging global environment. The company's focus on expanding its capabilities, improving operational efficiency, and maintaining a strong financial position bodes well for its future prospects in the contract research and manufacturing services sector.