INP-WealthPk

Declining interest rates spark optimism for Searle's profitability ahead

February 04, 2025

Shams ul Nisa

Searle Limited Company has announced a substantial decrease in finance costs, driven by lower interest rates, reports WealthPK.

Thus, the company’s financial performance stands out with a 26% reduction in finance costs, totaling Rs741.19 million. This significant reduction is largely due to lower borrowing expenses, driven by a decline in interest rates. The company remains optimistic about additional decreases in interest rates, which are expected to further strengthen its financial position and contribute to improved profitability in the coming periods. Searle’s financial performance for the three months ending September 30, 2024 highlights its emphasis on cost management and improving operational efficiency.

The company’s revenue for the period stood at Rs6.67 billion, marking a 12% decrease from Rs7.5 billion in the same period last year. This decline was primarily due to the efforts to manage distributor-level inventory and adjust the product mix, aimed at enhancing the supply chain efficiency and optimizing the product portfolio. Additionally, the operating expenses dropped by 10% compared to the previous year. This reduction was achieved through tighter cost control measures and strategic adjustments to its product mix, designed to streamline operations and enhance the supply chain efficiency.

Established in Pakistan in October 1965, Searle focuses on manufacturing pharmaceuticals and consumer products. Thus, the company is dedicated to fostering growth through a combination of organic expansion and targeted strategic acquisitions. The company is proactively addressing a range of socio-economic, political, and environmental challenges, ensuring it remains adaptable in a complex landscape. According to the director’s report, by adopting a forward-thinking approach, Searle is better equipped to handle external uncertainties, including exchange rate volatility and rising inflation while maintaining its focus on sustainable growth and operational resilience.

During the review period, a major milestone in Searle's strategic efforts is the approval of ADALIMUMAB, Pakistan's first locally produced biosimilar drug. This achievement is set to bolster the company’s presence in the biotechnology sector and diversify its product portfolio. Furthermore, the recent deregulation of prices for non-essential drugs is expected to create additional opportunities for profitability and provide a strong foundation for Searle's ongoing business expansion plans. Hence, Searle is well-positioned for long-term sustainable growth with favorable interest rate trends and strategic initiatives underway.

The company lays emphasis on innovation, product diversification, and geographic footprint expansion to capitalize on increasing export opportunities in key international markets. By maintaining a proactive approach and prioritizing timely, strategic decision-making, Searle demonstrates its commitment to overcoming the global market challenges, paving the way for promising outcomes and value creation for its stakeholders.

Credit: INP-WealthPk