Alicon Castalloy (531147) Q4 97/98 earnings summary

Executive summary

• FY98 profit improved despite lower sales and production, supported by cost-reduction measures amid an automotive slowdown.

• Maiden dividend of 10% on equity shares recommended.

Financial highlights

• Sales and other income were Rs. 1,211.28 lakh vs Rs. 1,240.40 lakh in FY97; sales quantity and production were below prospectus projections.

• PBT rose 51.02% to Rs. 79.74 lakh from Rs. 52.80 lakh; PAT was Rs. 71.37 lakh vs Rs. 44.90 lakh.

• Financial expenses were Rs. 95.88 lakh vs Rs. 89.48 lakh; depreciation was Rs. 52.41 lakh vs Rs. 37.64 lakh.

• Prior-period adjustments were a credit of Rs. 0.65 lakh in FY98 vs a credit of Rs. 8.21 lakh in FY97; FY98 also included Rs. 0.16 lakh of prior-year tax adjustments.

Outlook and guidance

• Automotive-sector slowdown continued, particularly in premium vehicles; new product and customer development was underway to broaden market reach.

• Four-stroke engine adoption by two-wheeler makers to meet emissions norms was expected to benefit cylinder-head technology offered.

• Castings developed and exported to France were well received, with further continuing orders expected.