It attributed the downturn to the July-August mass upsurge, labour unrest, and prolonged flooding, which significantly impacted operations and distribution channels.
Square Pharmaceuticals – the country’s leading drug manufacturer – reported its first-ever revenue decline for the July-September quarter.
It attributed the downturn to the July-August mass upsurge, labour unrest, and prolonged flooding, which significantly impacted operations and distribution channels.
Other top-listed pharmaceutical companies, including Beximco Pharma, ACME Laboratories, and Renata, also failed to achieve the usual double-digit revenue growth seen in the sector since 2014.
Only Beacon Pharma and Navana Pharma secured double-digit revenue growth, but their market share remains small.
The depreciation of the taka further pressured these companies, as they rely heavily on imported raw materials, which increased production costs. Rising utility costs also strained profits, resulting in a drop for most major players.
Among the leading companies, ACME Laboratories, Beacon Pharma, and Renata saw a decline in profits, while Square and Beximco managed to post profit growth, largely supported by income from associate companies.
Company insiders stated that drug manufacturers have faced rising production costs in recent years, which have squeezed their profit margins. However, due to government regulations, they have been unable to raise medicine prices in line with these cost increases.
While the government has approved price hikes for a few select medicines in response to industry requests, insiders noted that this adjustment has been insufficient to offset the overall cost pressures faced by the sector.
Square Pharma
According to its unaudited financial statement for the July-September quarter, Square Pharma reported revenue of Tk1,774 crore, a slight drop from Tk1,781 crore in the same quarter the previous year.
Zahangir Alam, chief financial officer of Square Pharma, told The Business Standard, “This is the first time we’ve experienced a decline in revenue.”
The decline is attributed to several factors, including the turmoil surrounding the July-August mass upsurge, ongoing labour unrest, and unprecedented flooding, he added.
Its operating profit also dropped around 13% to Tk556 crore during the quarter. However, thanks to income from investments and associate companies, Square Pharma managed to post a 1.54% increase in profit to Tk609 crore during the quarter.
Square’s share closed 0.22% higher at Tk224.90 on Thursday.
Beximco Pharma
Beximco Pharmaceuticals Limited posted an 8% profit increase, reaching Tk169.18 crore in the first quarter of FY25 compared to the previous year. Revenue also rose by around 5% to Tk1,171.38 crore.
Its earnings per share increased to Tk3.77, up from Tk3.48 in the same quarter last year. Its shares closed 5.56% higher at Tk89.20 on Thursday.
Iqbal Ahmed, managing director of Beximco Pharma, said in a statement to the London Stock Exchange on Thursday, “We have started the year with modest revenue growth amid ongoing macroeconomic challenges.”
“However, as demonstrated in our recent strong full-year results, through the resilience and underlying strengths of the business, we remain confident in executing our growth strategy by providing high-quality and affordable medicines to patients and ultimately delivering value for shareholders,” he added.
Renata
Renata’s revenue grew approximately 7% year-on-year, reaching Tk1,009 crore for the quarter. However, its net profit fell sharply by 44% to Tk56 crore compared to the same period last year.
Company Secretary Jubayer Alam told TBS that the company has continued to post solid consolidated revenue growth, despite challenges from political unrest in July-August and significant flooding in August.
He attributed the profit decline to rising costs in raw materials, labour, power, finance (including interest expenses and foreign exchange losses), and depreciation on recent investments.
Renata’s shares closed at Tk656.50 yesterday, marking a slight decrease of 0.30% from the previous session.
Other companies
ACI Limited reported a 2% decrease in revenue to Tk2,970 crore, while it incurred a loss of Tk42 crore in the July-September quarter.
ACME Laboratories saw revenue rise by around 5% to Tk834 crore in the July–September period. However, net profit dropped by 17% to Tk55 crore during the quarter.
Beacon Pharma posted a 21% growth in revenue to Tk280 crore, though profit slightly decreased to Tk36 crore.
Navana Pharma reported a 31% increase in revenue to Tk213 crore, while profit rose by 19% to Tk13.37 crore.
