DRIVIN G ROWTH - Dr. Reddy's

64
management discussion
and analysis
Table 8
|
Income, profits and capital employed by
business segments, 2001-02
RS. MILLION
2001-02
Segment Revenue
a) Active Pharmaceutical Ingredients and Intermediates 5,952
b) Formulations 6,294
c) Generics 4,141
d) Diagnostics, Critical Care and Biotechnology 424
e) Drug Discovery 344
Total 17,155
Less: Inter segment revenue 1,047
Add : Other unallocable Income 408
Total income 16,516
Segment Results
(Profit)(+)/loss(-) before tax and interest from each segment
a) Active Pharmaceutical Ingredients and Intermediates 807
b) Formulations 2,182
c) Generics 3,402
d) Diagnostics, Critical Care and Biotechnology (6)
e) Drug Discovery (176)
Total 6,209
Less: (i) Interest 109
(ii) Other un-allocable Expenditure net off un-allocable income 1,392
Total profit before tax 4,708
Capital Employed
a) Active Pharmaceutical Ingredients and Intermediates 4,266
b) Formulations 3,018
c) Generics 1,887
d) Diagnostics, Critical Care and Biotechnology 466
e) Drug Discovery 32
f) Others 5,301
Total 14,970
The following are important non-cash
charges:
■ Depreciation was Rs. 474 million in 2001-02,
against Rs. 425 million in 2000-01.
■ There was an amortisation charge of long
term deposits amounting to Rs. 23 million.
■ There has also been a one-time, non-cash
charge of Rs. 1,149 million which includes:
1 Provision for permanent decline in value of
long term investments of Rs. 217 million—
consisting of: (i) Rs. 67 million in Compact
Electric Ltd., a subsidiary of Dr. Reddy’s,
(ii) Rs. 85 million for investments in Aurantis
Farmaceutica Ltd. (JV in Brazil), and (iii) Rs.
65 million for Biomed Russia Ltd., a
subsidiary of Dr. Reddy’s.
2 Deferred revenue expenditure written-off
Rs. 931 million in basic research and
generics (see Note 3 of Notes to Accounts).
The Company’s return on capital employed
(ROCE) in 2001-02 was of 31 per cent,
versus 19 per cent in 2000-01. Dr. Reddy’s
return on net worth (RONW) increased
from 26 per cent in 2000-01 to 32 per cent
in 2001-02.
SEGMENT REPORTING
ACCOUNTING STANDARD 17 (AS-17)
issued by the Institute of Chartered
Accountants of India (ICAI) mandates
companies to identify business segments, and
DR. REDDY’S LABORATORIES LTD. | MANAGEMENT DISCUSSION AND ANALYSIS | ANNUAL REPORT 2001-2002