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Revenue Growth: Division of product sales increased by 27% for the first half of FY25.
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Animal Healthcare Division Growth: 4% growth in Q2 FY25; 20% growth in H1 FY25.
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Poultry Healthcare Division Growth: 20% growth in Q2; 27% growth in H1 FY25.
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Pet Care Division Growth: 12% growth in Q2; 20% growth in H1 FY25.
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Gross Profit Margin: Improved by 6% in H1 FY25.
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EBITDA Margin: Improved by 4% due to better absorption of fixed costs.
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Overall Profit: Increased by 38% with a 3% improvement in the profit ratio.
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Hester Nepal Turnover: INR 2.13 Crore in Q2, showing growth from Q2 FY24.
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Africa Topline: INR 9.2 Crore in Q2 compared to INR 1.96 Crore in the corresponding quarter.
Release Date: October 28, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Hester Biosciences Ltd (BOM:524669) reported a 27% increase in divisional product sales for the first half of FY25 compared to the previous year.
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The animal healthcare division saw a 20% growth in H1 FY25, driven by sustained demand in the dairy sector.
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The poultry healthcare division achieved a 27% growth in H1 FY25, with a 59% increase in exports of poultry vaccines.
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The pet care division reported a 20% growth in H1 FY25, with the successful launch of a new prescription-based pet food diet.
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Gross profit margins improved by 6% in H1 FY25 due to a favorable product mix, leading to a 4% improvement in EBITDA margin.
Negative Points
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The overall revenue from operations appeared flat due to one-time sales in Q1 of the previous year.
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Despite growth, the animal healthcare division only registered a modest 4% growth in Q2 FY25.
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The company is still working on reducing losses in its African operations, despite positive topline growth.
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The pet care division, while promising, currently lacks vaccine products, which are a core part of Hester's business.
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The company faces a challenging market environment in certain areas, which could impact future growth.
Q & A Highlights
Q: Can you elaborate on the growth trajectory and focus areas for Hester Biosciences moving forward? A: Rajiv Gandhi, CEO and Managing Director, emphasized that the company is on an upward trajectory in terms of both top line and bottom line. The focus will be on strengthening the animal healthcare division and improving cash flow. The pet care division is seen as a promising area with potential to become a major division within the organization, reflecting global trends where pet businesses often surpass other divisions in animal health companies.