FEROZSONS LABORATORIES LIMITED

MARCH 31, 2004

We are pleased to present your company's individual and consolidated un-audited accounts for the Quarter ended September 30, 2004. The consolidated accounts present the combined financial results of the Company's core pharmaceutical manufacturing operations, and its retail Farmacia Division, which was separated as a legal entity under permission of the Shareholders on May 26, 2003.

We are pleased to report that during the Quarter under review, your company's Net Sales improved by 31.92%, from As. 111.158 Million in the first Quarter Last year to As. 146.643 Million during 01 of the current year.

The restructuring of the Company's Farmacia chain operations and closure of its loss making branches led to a dilution in the growth of the Consolidated Net Sales, which grew by 8.30 % during the Quarter under review to As. 165.013 Million, from As. 152.366 Million achieved during the first Quarter of last year. At the same time, however, Farmacia's profitability has increased significantly as a result of its restructuring. The Company's share in the profit of Farmacia improved by almost 200% for the Quarter to As. 0.635 Million, and is expected to increase further during the coming quarters.

Your Company's Cost of Sales increased by 38.30%, reflecting an increase in the cost of materials for your company resulting from a weaker rupee. Correspondingly, Gross Profit of the Company grew to As. 89.160 Million, up by 28.11 % from the Gross Profit of As. 69.596 Million achieved during the same quarter last year.

Administrative Expenses increased to As. 8.239 Million during the Quarter (an increase of 10.44%), whereas Selling and Distribution Expenses increased by 4.87% to As. 31.569 Million for the Quarter. Financial expenses fell by 26.17% to As. 0.284 Million during the same period.

After a provision for taxation and other government levies of As. 18.915 Million, the Net Profit of your company for the Quarter under review stands at As. 31.567 Million, an increase of 49.29% over the figure of As. 21.145 Million over the corresponding period of last year. The Quarterly Earnings per Share (EPS) of your Company on its increased paid-up capital (after issue of 25% bonus shares for the year ended June 30, 2003) stand at As. 5.72, compared to As. 3.87 achieved during the First Quarter of last year.

We are hopeful that your company will be able to increase its productivity and improve upon its performance during the coming quarters.

For and on Behalf of the Board of Directors

October 29. 2004

(Mrs, Akhter Khalid Waheed) Chairperson & Chief Executive