AIA Engineering (AIAENG) Q4 09/10 earnings summary

Executive summary

• Material sold increased YoY despite recessionary conditions; wider cement-market reach and diversification across minerals supported growth initiatives.

• Consolidated production was 101,561 MT vs 103,570 MT in FY09; consolidated sales and profit were lower YoY.

Financial highlights

• Consolidated net sales were Rs.94,970.14 lacs vs Rs.102,329.10 lacs; PBT was Rs.23,700.81 lacs vs Rs.24,933.10 lacs.

• Consolidated PAT after minority interest was Rs.17,074.05 lacs vs Rs.17,345.48 lacs; EPS was Rs.18.10 vs Rs.18.39.

• Standalone sales were Rs.80,419.50 lacs vs Rs.92,285.95 lacs; PAT was Rs.12,256.19 lacs vs Rs.13,345.77 lacs.

• Consolidated EBITDA was Rs.26,111.52 lacs, 27.49% of sales, vs Rs.27,165.55 lacs, 26.55% of sales.

Outlook and guidance

• Targeting annual capacity of 200,000 MT, up from 165,000 MT; a 20,000 MT vertical mill internals plant was expected to commission in July 2010.

• Expansion capex of ~Rs.50 crore was planned for FY11, funded through internal cash generation.

• Management expected EU and US markets to begin recovery in FY11 and described long-term prospects as strong.