Why Did Morepen Labs’ Q4 Net Profit Decline by 29%?
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Synopsis
In a recent announcement, Morepen Labs reported a startling 29.3% decline in its net profit for Q4 FY25, driven by rising expenses. Despite a revenue increase of 10.1%, the company's profitability has taken a hit. Dive into the details of the financial landscape affecting this pharmaceutical giant.
Key Takeaways
- 29.3% net profit decline in Q4 FY25.
- Revenue increased by 10.1% to Rs 465.8 crore.
- Operating costs surged, impacting profitability.
- EBITDA decreased by 12.6%.
- Proposed Rs 0.20 dividend pending AGM approval.
Mumbai, May 12 (NationPress) The pharmaceutical firm Morepen Labs has announced a 29.3% reduction in its net profit for the fourth quarter (Q4) of FY25, attributed to escalating costs impacting the company's financial health. The net profit for this quarter was recorded at Rs 20.3 crore, a decline from Rs 28.7 crore during the same period last year, as per their filing with the stock exchange.
Meanwhile, the total revenue for Q4 saw an uptick of 10.1%, amounting to Rs 465.8 crore, compared to Rs 423 crore in the corresponding quarter last fiscal.
Despite this revenue increase, a rise in operating expenses significantly affected profitability.
The company reported a 12.6% drop in earnings before interest, taxes, depreciation, and amortization (EBITDA), totaling Rs 42.3 crore for the quarter, down from Rs 48.4 crore in Q4 FY24.
This resulted in a margin of 9.1% for Q4, a decrease from the 11.4% margin reported in the same period of the previous financial year.
Total expenses for Morepen Labs in Q4 rose by nearly 15.5%, reaching Rs 444.7 crore, up from Rs 385.1 crore in the same quarter last fiscal year.
A key driver of this increase was the surge in the cost of materials consumed, which jumped by around 21.89%, from Rs 220.2 crore to Rs 268.4 crore.
Employee benefits expenses also witnessed a rise of about 19%, reaching Rs 57 crore for Q4, in comparison to Rs 47.9 crore during the same period last fiscal.
Furthermore, depreciation and amortization costs experienced a sharp increase of 71.56%, climbing from Rs 9.6 crore in Q4 FY24 to Rs 16.47 crore in Q4 FY25.
The Board of Directors has also proposed a final dividend of Rs 0.20 per share for the financial year ending March 31, pending approval from shareholders at the upcoming Annual General Meeting (AGM).
Point of View
It is crucial to recognize that while Morepen Labs has experienced a troubling financial quarter, the increase in revenue indicates potential resilience. However, the rising costs present a challenge that needs addressing. Stakeholders should remain informed and proactive as the company navigates these turbulent waters.
NationPress
21/07/2025
Frequently Asked Questions
What caused the decline in Morepen Labs' profits?
The decline in Morepen Labs' profits was primarily due to rising operational expenses, despite a significant increase in total revenue.
How much did Morepen Labs' revenue increase in Q4 FY25?
Morepen Labs' total revenue increased by 10.1%, reaching Rs 465.8 crore in Q4 FY25.
What is the recommended dividend for Morepen Labs for FY25?
The Board of Directors has proposed a final dividend of Rs 0.20 per share for the financial year ending March 31, subject to shareholder approval.
What was the EBITDA for Morepen Labs in Q4 FY25?
The EBITDA for Morepen Labs in Q4 FY25 was Rs 42.3 crore, reflecting a 12.6% decrease from the previous fiscal.
How has employee expenses changed for Morepen Labs?
Employee benefits expenses rose by approximately 19%, reaching Rs 57 crore in Q4 FY25.
