• Sales increase 42% at Rs.16,480 million for FY07.
• Net income at Rs.763 million for FY07.
• Net sales stands at Rs.4,374 million for Q4FY07, up 11% over the corresponding quarter in the previous year.
• Net income stands at Rs.275 million for Q4 FY07.
• 28 FDF filings including 12 for US in FY07.

Rajiv Malik, Managing Director and CEO of Matrix Laboratories Limited, commented: “We are very pleased with these results and with the progress we are making as we continue to re-align and adjust our company’s focus and activities in line with the broader opportunities that we now have within Mylan. Becoming a Mylan subsidiary has opened up new opportunities for Matrix and the recent announcement of the acquisition of Merck KGaA’s Generic business by Mylan provides additional opportunities for Matrix.. These developments would provide global scale for achieving very efficient utilization of R&D, manufacturing and other resources of the company. We are proud that Matrix will become part of one of the world’s leading global generics companies.”

Mr. Malik further commented: “Matrix continues to expand its Anti-retro Viral (ARV) franchise by supplying both first and second line ARV APIs to domestic as well as international customers. Matrix recently signed an agreement with UNITAID and Clinton HIV/AIDS initiative for supply of second-line ARV drugs.

Financial and operation review

Matrix Laboratories has posted consolidated net sales of Rs. 16,480 million for the financial year ended 31st March 2007 which represents year-over-year growth of 42% (Previous Year: Rs 11,586 Million). The consolidated net profit for the year ended 31st March 2007 was Rs.763 million as against Rs. 1,992 million for the previous year.

For the Q4 FY07, net sales were Rs.4,374 million which represents a year-over-year growth of 11% compared to corresponding quarter in previous year. The consolidated net profit for the quarter ended 31st March 2007 was Rs 275 million compared to Rs.362 million for the corresponding quarter of the previous year.

The comparison of the year and quarter performance compared with previous year, corresponding quarter in the previous year is given below:

During the previous financial year FY06, the company had certain exceptional income of Rs.871 million at the EBITDA level. After removal of this exceptional income, the EBITDA stands at 2,114 million for FY06.

During the full year FY07, the lower EBITDA is primarily due to lower than expected earnings from Docpharma NV, a subsidiary of the company, and increased R&D spend.

During Q4, the percentage of EBIDTA to sales achieved is in line with the corresponding quarter of the previous year. However, the net income is lower due to higher interest, depreciation and taxes. During the quarter ended 31st March 2007, certain deferred tax assets had to be reversed at the subsidiaries’ level.

During FY07, Docpharma’s results were lower than expected due to price erosion for key products in the pharmaceutical business, initial costs incurred for the entry into new markets as well as lower margins in the hospital business.

During the year under review, the R&D spend was at Rs.1,008 million, showing an increase of Rs.156% over the previous year. The increase in R&D expenses is due to development of more number of APIs as well as ramping up of the Finished Dosage Development and filings. The Finished Dosage Development team was set up during the middle of financial year FY06 and in the first full year of operation in the financial year FY07, the company has made an impressive 28 Regulatory Filings. Of this 12 ANDAs have been filed with USFDA, 6 with the European regulatory agencies and 10 with WHO. During this year, 3 ANDAs were approved by the USFDA and 2 more approvals have been received for the dossiers filed with the European Regulatory agencies.

During the year under review, 25 US Drug Master Files (DMFs) and 12 EU DMFs were filed. As on 31st March 2007, the total US DMF filed by Matrix Laboratories and its subsidiaries and associates is at 111.

During FY07, the company filed 22 patents taking the total tally of patents filed to 76.

During the financial year 2007 the company completed US FDA audits of API manufacturing facilities -Unit VIII located at Vishakapatnam, Unit I located in Kazipally and FDF manufacturing facility located at Nashik successfully. With this, all API plants of the company located in India are approved by USFDA

During the quarter as well as for the full year, the interest expenses have been higher due to the interest on the term loan of Euro 165 million taken by the company for the acquisition of Docpharma, as well as higher interest on the working capital loans.