The board has recommended a lower dividend of Rs 8 a share, against the previous year's Rs 9 a share, payable on all 45-lakh fully paid-up equity shares of Rs 10 each.

Sales, however, rose 12.62 per cent to touch Rs 164.25 crore, versus Rs 145.84 crore in the previous year. Other income was lower at Rs 7.85 crore, as against the previous year's Rs 10.40 crore.

Rhone-Poulenc's profit before tax was substantially lower at Rs 19.35 crore, against Rs 31.46 crore in the previous year. The previous year's net-profit figures included an amount of Rs 2.15 crore towards reversal of revaluation depreciation of earlier years.

The company's net-profit margins were down to 7.85 per cent, compared with 13.82 per cent in the previous year.

Analysts attributed the slump in profits partly to the spurious drugs menace in the area ofbranded formulations besides the impact of the generics business acquired from Max Pharma.

"The generics business has added close to Rs 23 crore to the company's turnover, but this business is a low-margin one. The company needs to launch high-volume new products," an analyst said.

They said the current fiscal too could see a turnover growth of around 7 to 8 per cent, while profit margins were seen in the region of 10-12 per cent.Depreciation was marginally higher at Rs 3.13 crore, while interest expenses rose to Rs 35.88 lakh.

Provision for taxation (net of prior years' adjustment) was Rs 6.45 crore, against Rs 13.45 crore in the previous year.