Gland Pharma Ltd

NSE:GLAND

Earnings Call Analysis

Gland Pharma Sees Strong Q1 FY '25 Growth, but Cenexi Impacts Profits

Gland Pharma had a strong start in Q1 FY '25, with consolidated quarterly revenue reaching INR 14,017 million, up 16% year-on-year, driven by strong U.S. market performance. Their core markets grew 25%, and the U.S. saw a revenue boost of 27% due to existing and new product launches. However, net profit fell 26% to INR 1,438 million, mainly due to the newly acquired Cenexi, which is still transitioning to profitability. Despite Cenexi’s negative impact, the company's base business remains robust with a 14% revenue increase. Gross margins were steady, but consolidated EBITDA margins dropped to 19% from 25% year-on-year.

Strong Start to the Fiscal Year

Gland Pharma has kicked off the fiscal year 2025 with a robust performance, reporting a consolidated revenue of INR 14,017 million, showcasing a 16% increase year-on-year (YoY). This growth was primarily driven by the base business which contributed INR 10,134 million in revenues, a 14% rise compared to the same quarter last year. The company has achieved this growth despite the ongoing turnaround challenges at Cenexi, its European CDMO business.

Margins Under Pressure but Signs of Recovery

The gross margin for Q1 FY '25 decreased to 60% from 63% in Q1 FY '24, largely affected by the product mix. However, Cenexi demonstrated resilience with a gross margin of 78%. The consolidated EBITDA was INR 2,654 million, an 11% drop from the previous year, reflecting the impact of Cenexi's negative EBITDA during this period. The EBITDA margin also fell to 19%, down from 25% in the prior year, although the base business maintained a stable EBITDA margin of 29%.

Impact of Cenexi on Overall Performance

Cenexi continues to influence Gland's overall performance. The net profit for Q1 FY '25 was INR 1,438 million, representing a 26% decrease from INR 1,941 million in Q1 FY '24, due to the challenges faced by Cenexi. However, the Profit After Tax (PAT) from the base business saw a 20% increase. The company expects improvements in consolidated margins as Cenexi progresses towards profitability.

Continued Investment in Research and Development

For Q1 FY '25, Gland Pharma's R&D expenditure amounted to INR 489 million, up from INR 457 million the previous year, representing around 5% of revenue from operations. The company filed eight Abbreviated New Drug Applications (ANDAs) and secured approvals for seven during the quarter. This ongoing commitment to R&D underscores Gland's strategy to sustain its competitive advantage.

Geographical Performance Highlights

The geographical performance yielded mixed results. Gland's core markets demonstrated a robust 25% revenue growth, while the U.S. market saw a notable 27% increase. However, operations in the rest of the world, which contributed 20% of overall revenue, were down by 3% YoY. The Indian market, accounting for 5% of revenues, faced a 19% decline, which the company described as a deliberate strategy pending evaluation of future directions.

Looking Ahead: Guidance and Strategic Focus

Management anticipates that the base business will continue to grow in the mid-teens range with a targeted EBITDA margin between 32% to 33%. Furthermore, Cenexi is expected to achieve positive EBITDA in Q4 FY '25, with revenues projected to surpass the EUR 200 million mark in the next fiscal year. The upcoming quarter may experience a temporary slowdown due to a three-week production shutdown in August, primarily for the installation of a new high-speed ampoule line aimed at enhancing capacity.

Emerging Opportunities in the Biologics Sector

Gland Pharma is strategically positioning itself in the biologics landscape, with ongoing discussions for potential collaborations in large-scale contract manufacturing of biosimilars. While this remains in the preliminary stages, the efforts align with Gland's long-term vision of expanding its portfolio in the biologics market, which is increasingly sought after by international players, enhancing its value proposition.

Conclusion: A Company on the Path to Recovery and Growth

In conclusion, despite the challenges faced by Cenexi and the pressures on overall margins, Gland Pharma's fundamentals remain strong. The growth in core markets, continued investment into R&D, and strategic initiatives in both biologics and contract manufacturing signal a positive outlook. With strong revenue growth and management's clear focus on profitability, Gland Pharma is well-positioned for recovery and sustained growth, providing a compelling opportunity for investors.

Earnings Call Transcript 2025-Q1

[Operator]

Ladies and gentlemen, good day, and welcome to the Q1 FY '25 Conference Call of Gland Pharma Limited.

[Operator Instructions]

Please note that this conference is being recorded.

I now hand the conference over to Ankit from Gland. Thank you, and over to you, Ankit.

[Ankit Gupta, executive]

Thank you, Sagar. Good evening, everyone, and we welcome you to Gland Pharma Earnings Conference Call for Q1 FY '25. My name is Ankit and I head investments, M&A and corporate strategy at Gland. Joining me today on the call are Mr. Srinivas Sadu, Executive Chairman and CEO; Mr. Alain, the CEO of Cenexi, our European CDMO business; and Mr. Ravi Mitra, our CFO.

Together, today, we'll discuss our business performance and address any questions that you may have. We'll begin with the business highlights from Mr. Sadu, followed by an overview of Cenexi's performance from Alain. And lastly, the group financial review by Ravi. Before we proceed, I'd like to remind everyone that some of the statements made today will be forward-looking and will be based on our current estimates. These statements should be considered in light of the risks that are associated with our business. The call is being recorded, and a playback and transcript will be available in due course on our website.

With that, I hand over the call to Mr. Sadu for his opening remarks. Thank you, and over to you, Mr. Sadu.

[Srinivas Sadu, executive]

Thank you, Ankit. Good evening, everyone, and welcome to Gland Pharma's Q1 FY '25 Earnings Conference Call. I'm happy to report that, we have had a good start to the fiscal year, meeting our expectations and aligned with what we had indicated in our base business and Cenexi. On a consolidated basis, we achieved INR 14,017 million in quarterly revenue, reflecting a 16% year-on-year growth. This performance aligns with our outlook and is driven by healthy results in core markets, along with incremental revenue from Cenexi.

Our base business, excluding Cenexi achieved INR 10,134 million in revenue, a 14% increase compared to the same period last year. While gross margins remained relatively stable, base business EBITDA margins were at 29% compared to 30% in Q1 FY '24. Our consolidated EBITDA margins for the quarter were 19%, impacted mainly by Cenexi, which despite showing the improvement this quarter, still on the path to profitability.

Shifting our focus to geographical performance, our core markets achieved a 25% revenue growth in Q1 FY '25 and now constitute 76% of our total revenues.

The U.S. market continued its strong performance with a 27% increase in revenues, primarily due to a healthy volume share of existing products and new launches like eribulin, plerixafor, nelarabine, edaravone. Despite year-on-year stability, the U.S. market remains crowded requiring manufacturers to maintain continued focus on cost competitiveness.

The rest of the world markets contributed 20% of our revenue in Q1 FY '25, a 3% decrease compared to Q1 FY '24. This performance reflects the inherent fluctuations in the business as some tender-led procurements from partners have been delayed to subsequent months. However, the rest of the world markets are expected to grow at a healthy rate on an annual basis.

The Indian market made up 4% (sic) [ 5% ] of our revenue in Q1 FY '25, experiencing a 19% decrease compared to Q1 FY '24. This performance was by design, and we are currently evaluating various strategic options to determine the best path forward for this business.

Moving to R&D. Our total expenditure in Q1 FY '25 was INR 489 million, representing 5% of our base business. We filed 8 ANDAs during the quarter and received approval for 7 ANDAs. As of June 30, 2024, Gland and its partners have filed 356 ANDAs in the United States, with 295 approved and 61 pending approvals. Currently, the company holds 1,708 product registrations worldwide.

During the quarter, the U.S. FDA made 2 surprise inspections of our manufacturing sites in Hyderabad. The inspections concluded with 2 and 3 Form 483 observations at Dundigal and Pashamylaram, respectively. As previous communicated, these observations are procedural and do not affect our compliance status.

While the generic business is progressing as planned, our biologics CDMO business is also experiencing positive momentum. Our biologics facility in Genome Valley is attracting advanced-stage interest from multiple players for contract manufacturing of monoclonal antibodies and novel plasma-based proteins.

In addition, we are in discussions with the leading biologists company for a potential strategic collaboration. This collaboration could involve large-scale contract manufacturing of 4 biosimilars with a possible in-licensing opportunity for Gland Pharma in specific markets of interest. Although this discussion is in early stages, it represents promising avenues for Gland Pharma to maximize its value in both CDMO and complex portfolio expansion. We'll continue to update you on our progress.

Now turning our attention to Cenexi. The business recorded INR 3,883 million, which is EUR 43 million in revenue this quarter, with a gross contribution of 78% and a negative EBITDA of INR 286 million, which is EUR 3 million. We are pleased with the progress made and the positive impact of our cost control and efficiency efforts. While we remain optimistic about the opportunity, I must inform all of you that Cenexi is still a few quarters away from a complete turnaround.

Alain is here and with us today to provide a detailed overview of Cenexi's performance. Before passing the call to Alain, I want to reiterate that Gland has had a positive beginning of the year and is on track to achieve its targeted performance amidst expanding business opportunities. We're optimistic about even stronger results in the coming quarters.

Thank you, and over to you, Alain.

[Alain Kirchmeyer, executive]

Thank you, Sadu. Good evening, everyone. Cenexi's performance demonstrated an upward trend this quarter. While revenues increased, we also successfully reduced losses through improved operating cost leverage and continued efforts in managing costs and efficiencies. Our Fontenay manufacturing site near Paris, a significant contributor to overall revenues has shown continuous improvement in operational performance. We are now realizing the benefits of actions initiated earlier this year, including operational efficiency enhancements, additional weekend shifts, organizational changes, optimized production planning and maintenance reorganization.

As a result, this quarter, the site shipped higher volumes while simultaneously reducing backlog. The Fontenay site derives the majority of its revenue from ampoule fill and finish operations, and we are currently adding new ampoule line. This line will be commissioned during the summer shutdown period of August with commercial production slated to beginning early 2025. We anticipate that this new line will significantly increase capacity, improve customer service and generate approximately EUR 10 million in revenue in 2025.

Our site in Hérouville in Normandy is poised for future growth with significant new business expected from ongoing technology transfer projects. I am pleased to report that these programs are progressing well, and our new aseptic gel line will begin commercial production for our key customers before the end of the year.

Our operations in Belgium and in Osny in France remains on track, and we are fully committed to delivering on our business plans for the year as expected. We are also gaining good traction from partners in new areas outside of small molecules, such as biologics, plasma fraction and several difficult-to-make technologies.

While we are making good progress and our course correction plan is gaining momentum, I must also share a few important updates that may impact our performance in the next quarter.

First, the July to September quarter will be impacted by August typically lower activity levels due to the European holiday season and planned summer maintenance shutdowns at our plants.

Notably, our Fontenay plant will have an extended shutdown of 3 weeks to accommodate the installation and connection of the new ampoule line.

Second, based on the latest forecast, we reaffirmed the outlook communicated during the last investors call, a positive EBITDA for Q4 of this fiscal year and a positive EBITDA for the next fiscal year driven by increased revenue exceeding the EUR 200 million threshold.

Thank you. I will now turn the call over to Ravi to discuss finance performance. Ravi, please proceed.

[Ravi Mitra, executive]

Thank you, Alain. Good evening, everyone, and thank you for joining us for our first quarter earnings call. I hope you have had the opportunity to review our financial results and investor materials disclosed to the stock exchanges. Let me share the performance highlights for the first quarter. Our consolidated from operations reached INR 14,017 million in Q1 FY '25. However, Cenexi revenue in Q1 FY '25...

[Operator]

Sorry to interrupt, sir, we have lost your...

[Ravi Mitra, executive]

Yes, can you hear?

[Operator]

Yes, we can hear you now, sir.

[Ravi Mitra, executive]

However, Cenexi revenue in Q1 FY '25 is not comparable with Q1 FY '24 due to acquisition of Cenexi consummated in the end of April 2024. The revenue grew by 16% compared to the same quarter last year. This growth was primarily attributed to the base business, excluding Cenexi which grew at 14%, led by increase in volumes of existing and new launches in the U.S. market.

Other income for Q1 FY '25 reached INR 514 million primarily comprising interest on fixed deposits. This is an increase compared to Q1 FY '24, where other income was INR 375 million, largely due to increase in interest on fixed deposits. Our gross margin for Q1 FY '25 was 60% compared to 63% in Q1 FY '24, impacted by the product mix at the base business for us. However, Cenexi's gross margin improved to its historical level of 78%.

In Q1 FY '25, we achieved an EBITDA of INR 2,654 million, an 11% decrease compared to INR 2,982 million in Q1 FY '24. This decrease was largely due to the consolidation of Cenexi's negative EBITDA during this quarter. Our EBITDA margin for Q1 FY '25 stood at 19%, down from 25% in Q1 FY '24. Our base business, excluding Cenexi, EBITDA margin remained stable at 29% in Q1 FY '25. With the active measures taken at Cenexi, we expect our consolidated margins to improve as Cenexi's turnaround progresses.

Our net profit for the first quarter was INR 1,438 million, a 26% decrease compared to INR 1,941 million in the same period last year. This decrease was primarily due to the impact of Cenexi. However, the PAT of our base business grew by 20%. The consolidated PAT margin for the quarter was 10% and the effective tax rate for the base business was 25%.

Total R&D expense for Q1 FY '25 amounted to INR 489 million, an increase from INR 457 million in the same period of the previous fiscal year. This represents 5% of our revenue from operations, excluding Cenexi.

As of June 30, 2024, our total cash and equivalents on a group level stood at INR 30,488 million and including the outstanding loans on Cenexi's books, our net cash position was at INR 27,430 million. We generated INR 4,277 million in cash flow from operations during the 3 months ending June 30, 2024, compared to INR 629 million as of June 30, 2023, due to improvement in cash conversion cycle.

The average cash conversion cycle improved, reaching 148 days for Q1 FY '25 compared to 233 days in the previous year due to reduction of inventory. We invested INR 637 million in capital expenditures during the current fiscal year, largely allocated towards upgrading and maintenance CapEx of Cenexi business.

With that, I will now turn the call over to the moderator to open the floor for questions and answers. Thank you.

[Operator]

[Operator Instructions]

Our first question is from the line of Saion Mukherjee from Nomura.

[Saion Mukherjee, analyst]

Just one question on the U.S. business. There seems to be some slowdown or a drop in the U.S. revenues, except Cenexi quarter-on-quarter. So can you just explain the dynamics there? And how should we think about in the subsequent quarters?

[Srinivas Sadu, executive]

I think the major difference is, I would say, on the milestone, as you see large -- last quarter, we had licensed some context products, which gave a larger revenue. So I would say the decline of U.S. about 14% from the previous quarter, 8% attributed to that. And if you see the quantity-wise, it's 2% lower. And also, I would say, it's a product mix.

We launched heparin back to one of the GPOs, which is a low value, I would say, high volume. And because of the large quantities, we have to supply a lot more quantities, which substituted the other products. So that kind of, I would say, small impact, but it will normalize over a period of time. So we'd still continue to -- I think over the next few quarters, it's normalized number. So I would say it's more a quarter impact.

[Saion Mukherjee, analyst]

Okay. And sir, my second question is on your comment on the domestic business, your plans around that and also acquisitions, if you can throw some light, how -- what are you thinking on both these fronts.

[Ankit Gupta, executive]

Saion, this is Ankit. So on the domestic business, as you would understand, most of our facilities are designed to supply for the global markets and predominantly U.S. When we supply in India, we use the same facility and somehow it compromises our overall economics on the business. We don't intend to scale that up unless we have found the solution to have a facility which is more dedicated for the India business. So I think that addresses that point.

On the acquisitions, I think there are 2 areas wherein we are largely focused. One is to look at opportunities on the complex injectable side, which is more to do with high R&D focused investments. And the second part, which we are very keenly evaluating is building capabilities also on the manufacturing side. Today, most of our capacities and capabilities are on the small molecule side. But even there, we feel that we have the ability to further go up and see if can do more of difficult-to-make products.

So this is the large near-term focus. Obviously, on the long term, we'll have to think through if we need more organic capacity to cater to our current growth which is coming from U.S. and RoW markets. But in the short term, these are the 2 focus areas for investments.

[Saion Mukherjee, analyst]

Right. And just one last question, if I can. Of the 61 ANDAs which are pending, is there a split available between Gland's on India and partner in India?

[Srinivas Sadu, executive]

I can give you a number -- exact number, but most of it will be Gland India's because lately everything is fine by client.

[Operator]

The next question is from the line of Neha Manpuria from Bank of America.

[Neha Manpuria, analyst]

Sir, given that [indiscernible] what is the thought to say in terms of holding in the company? Have we had any conversations with portion?

[Ankit Gupta, executive]

Neha, for some reasons, we couldn't hear your question well. Is it possible for you to steal it? I don't know if it is to do with speaker or something, but the voice was not clear.

Sagar, I think she has dropped off, so maybe we can take the next question first, and we'll have her on the queue soon.

[Operator]

The next question is from the line of Tushar Manudhane from Motilal Oswal Financial Services.

[Tushar Manudhane, analyst]

So just to continue on this milestone income, is that the reason for the quarter-on-quarter drop in the gross margins for the base business?

[Srinivas Sadu, executive]

What's the question, is that the reason?

[Tushar Manudhane, analyst]

Yes. So I mean basically trying to understand the dip in the gross margin as well, both quarter-to-quarter as well as year-over-year when we had good relaunches or certain complex product launches as well in the quarter.

[Srinivas Sadu, executive]

So if you see, it's basically what I've given answer for the first one, we kind of supplied more of heparin because of the new GPO contract we got. The contribution margin on heparin is lower compared to that. So the margin is, I think, is around 25%, 30%. So we -- the volumes what is supplied to last quarter, it's almost doubled. So that kind of diluted the overall margin, but it will normalize over the period because you supply -- when you start your contract, you supply 4 months of stock. So that's not taken away of capacity, a low-margin product. But that will be fine from next quarter.

[Tushar Manudhane, analyst]

Understood, sir. And on the biologics side, while the facility was from a specific vaccine point of view and changing the facility has been available. It's taking quite a long time to get the new contracts. And -- that is one. So if you could share further there. And this collaboration, which involves large-scale contract manufacturing. So here we're not sharing too much of detail, but what can be the time line to understand commercial benefit of this -- on this collaboration?

[Srinivas Sadu, executive]

While we can't name the company, probably it's a quarter, I would say, some clarity will come up on how this happened. But discussion is around investment in a large-scale production compared to what we have for some of the biologics what they're filed and some what in the commercial stage. And also -- in parallel also licensing some of the molecules for our other markets, 3 or 4 biologics products. So it's a combination of a CDMO business to expand, as you know, a lot more attractions come in recent months for Indian companies. So I would say it's a good sign. So this is in that -- I would say, in that direction.

CDMO -- combination of CDMO business for some of the commercialized and yet to be launched products and in licensing of some of the molecules, which have gone into clinical. So it's a combination of that. So no clarity we can give you in a quarter or so.

[Tushar Manudhane, analyst]

Understood, sir. And just extending into this as an industry Genome of the biosecure Act, is that also sort of benefiting us or and sort of being Chinese promoter company, you are not partner to that?

[Srinivas Sadu, executive]

Yes, yes. For sure, I think what we -- I just mentioned, I think that also is result of this, I would say, because I think we are seeing more inbounds than compared to before. And they're looking India as a second base for a lot of companies to have to derisk themselves. So I would say that would benefit for CDMOs in this space.

[Operator]

The next question is from the line of Neha Manpuria from Bank of America.

[Neha Manpuria, analyst]

Okay. Sir, we are on a pretty large stake in the quarter. Have you had any discussions about how they are thinking about the ownership in Gland? Do we think it goes down further? And over longer term, we have talked about evaluating front end in the U.S. How should we think about that?

[Srinivas Sadu, executive]

Yes. From [indiscernible] perspective, we don't really discuss about the shareholding. We only talk more about the synergies and how to expand businesses in different geographies with their network. But there's no communication around the equity and how they sell. We only know post factor, I would say. What's the other question, Neha?

[Neha Manpuria, analyst]

On the long-term strategy for the U.S. because I think last year, we were considering or evaluating a hybrid model of possibly going front end on our own. So is that still on the table?

[Srinivas Sadu, executive]

Yes, it is. It is still under the table. It's on the table. We are evaluating, but we can't comment. I think it's too early. But it's not like that our core focus will be CDMO and also getting into more complex CDMO that with the focus for the company with more and more companies approaching us on the buyer side. For sure, that will be a key focus in terms of investment. At the same time, the general business is key for us. So that will continue, but we have to see what are different options so that the base business will grow at least at a certain rate, while we build the other part of the business.

[Neha Manpuria, analyst]

Understood. And did I just get the previous comment right that the biosimilar discussions that are going on would require new investments in [indiscernible] manufacture.

[Srinivas Sadu, executive]

Yes. So -- while we can take on the CDMO and the smaller scale batches. But this also requires investment to increase the capacities what we have. And since it is backed up by CDMO contracts and also the commercial volumes, so that evaluation is happening. So it's backed up by that, then we'll work on the investment plan for that as well.

[Neha Manpuria, analyst]

Understood. And 1 housekeeping question. If you could just quantify the milestone in the profit share number for the quarter, please?

[Ravi Mitra, executive]

Profit share for this quarter is 10%. This is one thing at Cenexi, and milestone is 9%.

[Operator]

[Operator Instructions]

The next question is from the line of Karthik, who's an individual investor.

[Unknown Attendee]

Actually, is there any one-off from Cenexi in this quarter?

[Srinivas Sadu, executive]

No, no, there's no one-off. So it's a continuous CDMO business. So there's no one-off.

[Unknown Attendee]

Okay. Where do we expect the next leg of growth to come from for Gland? Are we continuing the plasma project and biosimilars, which we are discussing in the previous quarters?

[Srinivas Sadu, executive]

Yes, that's continued. And also the complex products, we have filed 6 products until now. So a few are good products on that. And 1 suspension product we have filed last quarter out of the 7 that we have filed. So that's another growth lever, I would say. And of course, the bio CDMO side where we are seeing a good traction, including the plasma project.

[Operator]

The next question is from the line of Bino Pathiparampil from Elara Capital.

[Bino Pathiparampil, analyst]

Just a question on the U.S. market. Last couple of quarters, your commentary was very positive in terms of customers coming back and quarries going up, a lot of demand for products, et cetera. Is that pretty much as great as of today? Or you have seen a bit of pulling off that tightened demand over the last couple of months?

[Srinivas Sadu, executive]

No, I would say the policy is still there. I mean, it's no different than what we have seen. If you see over -- if you see compared to the last year, it's almost -- the volume wise it's gone up by almost 30%. So -- but if you see the previous quarter, the quantity you can't really compare, it's almost same, I think, gone down by 2% U.S., but it's more to do with how many batches can make on those lines. And it's more a capacity situation on a couple of brands, which impacted us a bit. But otherwise, the demand is there. And on an annual basis, will still be a target to what we have envisaged at the beginning of the year.

[Bino Pathiparampil, analyst]

Understood. So last quarter, there was a high element of milestones. So excluding that, this quarter, so can you look at this quarter as a sort of maintainable base on which you will see some improvement as the quarters come by?

[Srinivas Sadu, executive]

Yes, I would say so because like I said, the milestone income was almost, I think, 16% last quarter because of some complex products getting licensed out. And this is not like depends on which quarter you license these kind of products and not every quarter, you're filing the complex products. So -- but on an annual basis, I think we still moderated and this business should grow.

[Bino Pathiparampil, analyst]

Got it. One more question on Cenexi. So next quarter, when you say we'll have a 3-week shutdown, if I say, roughly 1 month shutdown. Is it fair to assume the 2Q revenue will be 2/3 of 1Q revenue? Is that a right way of looking at it?

[Srinivas Sadu, executive]

Give me a second. It's not here. Can you repeat the question a little, it's not clear.

[Bino Pathiparampil, analyst]

Sure. Sir my question is in Cenexi, you talked about 3 weeks, 4 weeks shutdown in 2Q. So is it fair to assume that the Q2 revenue would be 2/3 of 1Q revenue level?

[Srinivas Sadu, executive]

Yes, correct. So that's correct. But at the same time, we're also using that time to install a new line so which will help us actually to produce more volumes in the future. So it's not that we're completely wasting that time, I would say. But at least utilizing that time to install a new high-speed line, which will increase the volumes in the future.

[Alain Kirchmeyer, executive]

And besides that, every year, we have a shutdown of roughly 2 weeks in all our plants because of the server break and heavy maintenance. So the actual impact is only 1 week more because of the installation of the new line.

[Operator]

The next question is from the line of Rahul Agrawal from Himalaya Investment.

[Rahul Agrawal, analyst]

Can you quantify the extent of the milestone and profit share component for last quarter versus this quarter?

[Ravi Mitra, executive]

Yes. So by last quarter do you mean Q4 or Q1 of previous year.

[Unknown Analyst]

Yes. Q4 of FY '24, yes.

[Ravi Mitra, executive]

Q4, profit share was same, 10% and milestone was 15%.

[Rahul Agrawal, analyst]

Okay. And this quarter, the profit share is 10%, milestone is 9%. So the gap of 6% on milestone.

[Ravi Mitra, executive]

That's correct.

[Rahul Agrawal, analyst]

And milestone. I'm assuming all this is [indiscernible] gross margins, so it flows straight down. So it affects both the gross margin and EBITDA margin.

[Ravi Mitra, executive]

Yes, it may not be 100% because there could be some costs related to the batches filed and all, but largely yes.

[Rahul Agrawal, analyst]

Got it. Got it. And putting it together, sir, from a full year perspective, what sort of growth do you see in your base business Ex-Cenexi for the full year?

[Srinivas Sadu, executive]

The mid-teens, that's what we guided and...

[Rahul Agrawal, analyst]

And from a margin profile perspective?

[Srinivas Sadu, executive]

So EBITDA, around 32%, 33%.

[Operator]

Ladies and gentlemen as there are no further questions, I would now like to hand the conference over to Ankit for closing comments.

[Ankit Gupta, executive]

Yes. Thank you, everyone, for connecting today. We understand most of the questions are addressed, but if there are any follow-on questions, please do feel free to reach out to us. We'll be available and happy to address. Looking forward to host you the next quarter soon. Thank you.

[Operator]

Thank you. On behalf of Gland Pharma Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.