Pfizer: A bitter pill
Shares of Pfizer Ltd. are down Rs. 53 or little over 3%, and currently trading at Rs. 1,653 a piece. The second quarter financial performance was poor, which resulted in poor reaction by the market.
Revenue in the second quarter dropped 11% QoQ to Rs. 296 crore, while fall in bottomline was steeper due to higher advertising and overheads of Rs 21 crore and exceptional items (VRS at Thane plant) of Rs. 76 crore. Thus, Q2 resulted in net loss of Rs. 12 crore as against Rs. 34 crore net profit in Q1FY15 and Rs. 70 crore net profit in Q2FY14. Also, lower interest income of Rs. 24 crore due to payment of interim dividend of Rs 360 per share shrunk other income to Rs. 10 crore from Rs. 34 crore corresponding quarter last year.
Bombay High Court has approved the merger of Wyeth with the company on 31st October 2014, and necessarily regulatory formalities are underway. The merger is expected to increase therapeutic presence thereby de-risking business. But for now, share is bearing the brunt of the poor financial show.