Morepen Laboratories Limited has announced its financial results for the 18 months ending 31st March 2005. The same were taken on record by the Board in its meeting held on 30th June 2005.

During the fiscal, the company has registered a sale turnover of Rs.131.11 Crores with an operating surplus of Rs.3.31 Crores.This has been possible on account of better margins resulting into the company emerging cash positive at EBIDTA levels. The EBIDTA level for the previous fiscal was an operating loss of Rs.34.43 Crores. The turnaround is obvious.

The major focus of the company is presently on development of international regulated markets for the products pipeline.Substantial efforts and focus have increased the export turnover ; contributing 71% to the top line as against only 33% in the corresponding period of the previous 18 months. Thus the company was able to shift the business model to high yielding, high quality long-term products and customers. International regulatory business has a long gestation peroid and needs continued efforts over a longer span of time before efforts yield result.

The Company was successful in filing 4 US DMFs during the period under review and has strengthened its IPR by filing 16 patents.

This year’s Diagnostic bussiness registered a growith of 38% with the sales growing from Rs.15.17 Crores to Rs.19.85 Crores. The business has grown both in terms of clinical diagnostics and consumer diagnostic. The Diagnostic Division has introduced further line extensions with JV partner Hemocue of Sweden. The company was, however, unable to deploy further resources on the pharmaceutical prescription business. Once the company gets regular working capital facilities from the banks and is able to fully utilize the existing facilities, the operating margins of the company would go up significantly. This would enable the company to honour its commitments towards principal amount and interest thereon to various categories of lenders.

The company is hopeful that it will script a strong turnaround which would enable it to be on a faster growth track.

The company after making necessary adjustments in its business model has been able to reduce its exposure to low yielding but working capital intensive products. The company, which was facing many challenges, has been able to arrest further drainage of resources and optimize the utilization of limited resources.

In a series of cost cuttings measures, the company has been able to down size manpower and effect substantial saving on the operational costs. It is now completely focussed on its core competencies and is striving to widen its product range by increasing its pipeline of ANDA’s and DMF’s.