Pharmaceutical: HIGHNOON LABORATORIES LIMITED - 1st Quarter Ended March 31 2004

It is a public limited company, incorporated in the province of Punjab and is listed on all stock exchanges of the country.
At present its share is trading at Rs 30.60 per share of Rs 10. During the last one year the market value of Highnoon Laboratories shares more than doubled from Rs 21 to Rs 46.75 per share.
The company is principally engaged in the manufacture, import and marketing of pharmaceutical and allied consumer products.
In 1Q 2004, the company's sales increased by Rs 25.44 million to Rs 219.94 million from Rs 194.50 million the 1Q 2003. Since the last 5 years the company's sales are trending upwards. The company has been able to improve gross margin which has been attributed to favourable sales mix synergies and manufacturing efficiencies.
The chairman mentioned that the management's strenuous efforts in formulating and implementing strategies to increase productivity resulted in the improvement in the performance.
Timely reimbursement of selling and promotional expenses by foreign principals eased cash flow position also contributed towards reduction of selling expenses.
Operating profit was slightly lower compared to the 1Q 2003. But financial and other expenses also reduced. Hence the company's pretax profit increased by 36.9% to Rs 14.47 million as compared with 1Q 2003 pre-tax profit of Rs 10.57 million.
But a larger tax provision nearly equalised the profit after taxation with 1Q 2003 and the Earning Per Share was up by only one paisa per share.
The financial backbone of the company remained robust as evidenced from solvency and liquidity ratios.

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Performance Statistics                (Million Rupees)

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Balance Sheet                                - As At -

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                                 March 31  December 31

                                     2004         2003

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Share Capital-Paid-up:             101.44       101.44

Revenue Reserves:                  122.47       114.40

Shareholders Equity:               223.91       215.84

Surplus on Revaluation of

 Fixed Assets:                      47.07        47.89

L.T Debts:                          44.58        44.38

Deferred Liabilities:               71.86        65.92

Deferred Gain:                       9.74        10.52

Current Liabilities:               346.98       332.30

Fixed Assets-Tangible:             331.21       325.95

L.T Investments:                     0.03         0.03

L.T Deposits:                        0.36         0.41

Current Assets:                    412.55       390.46

Total Assets:                      744.14       716.85

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Profit & Loss A/c For The Quarter

 Ended March 31                      2004         2003

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Sales-Net:                         219.94       194.50

Gross Profit:                       82.79        70.20

Operating Profit:                   19.73        20.32

Other Income:                        1.31         0.71

Financial & Other (Charges):        (6.58)     (10.46)

Profit Before Taxation:             14.47        10.57

Profit After Taxation:               7.25         7.09

Earnings Per Share (Rs):             0.71         0.70

Share Price (Rs) on 24.06.2004:     30.60            -

Price/Earning Ratio:                 4.31            -

Book Value of Share (Rs):           22.07        21.28

Debt/Equity Ratio:                  14:86        14:86

Current Ratio:                       2.14         1.18

Gross Profit Margin (%):            37.64        36.09

Net Profit Margin (%):               3.30         3.64

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