Highlights:
* Record Revenue since Inception of the Company with revenue growth to Rs.269 crores, 49% up from Rs.180 crores.
* EBITDA at Rs.55 crores in Q208, up 176% – Rs.20 crores in Q207.
* EBT before exceptional items is Rs.34 crores.
* PAT at Rs.(-)48 crores affected by restatement of FCCBs and MTM loss of Rs.28 crores.
* 3 new ANDAs filings with USFDA and 6 approvals received represents 19% of all FDA approvals in the Quarter issued to Indian companies.
* GAA shareholders’ approve Strides Controlling transaction – will emerge on closure, as the 4th largest Australian generic company.

Commenting on the Quarter Performance, Mr Arun Kumar, Vice Chairman & Group CEO said “By any measure, Q2-08 was an outstanding operating quarter for Strides Arcolab Limited. The achievements in the quarter go beyond the bottom line, as much has been done to set the foundations for future growth. PAT at Rs.(-)48 crores has been impacted by exceptional factors relating to restatement of FCCBs and ECB borrowings and provisioning of MTM loss to the extent of Rs.28 crores.

Exceptional Items

Exceptional items for the quarter is a loss of Rs.77 crores due to unrealised exchange loss on restatement of foreign currency borrowings including FCCBs and provisioning of MTM loss, as compared to a unrealised gain of Rs.15 crores in Q207. The loss or gain in this regard is a noncash charge/accrual.

As a prudent risk management policy, the Company doesn’t enter into any forex derivatives, which are speculative in nature. Hence there are no derivative transactions, which are speculative in nature outstanding as of date.

Share-holders approval of Genepharm Australasia Limited (GAA), Australia

Successful completion of this transaction will immediately bring the following synergies to Strides:

· Strides will emerge with a shareholding of approx 55% of the expanded capital base of GAA

· The combined regional businesses are expected to have revenues of approx A$100 million on closing of the GAA transaction.

· Contemporaneously with completion of GAA transaction, it is proposed that the companies enter into a 5 year Strides Preferred Supply Agreement, under which GAA, subject to any existing Strides supply arrangements in the region, will have the first right of refusal to distribute all existing and future Strides’ products (other than products for treatments of AIDS, Tuberculosis and Malaria) into Australia, New Zealand and the Asian regions, excluding Japan and China, where GAA will have the non-exclusive right to supply Strides’ products.

Commencement of supplies to North America

Shipments to the North American continent including the US and Canada commenced in Q208. With a robust filing and approval pipeline, we are confident of ramping of this business with our niche product strategy and derisked partnership model for the US markets.

Merger of 3 subsidiaries

The Board also approved merger of the 3 subsidiaries, namely, Grandix Pharmaceuticals Limited, Grandix Laboratories Limited and Global Remedies Limited. These companies are subsidiaries of Strides and the merger is for operating ease and will not result in dilution of equity or cash outflows.

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