Ambuja Cements (500425) Q4 01/02 earnings summary

Executive summary

• FY ended 30 June 2002: sales rose to Rs.1,583.01 crore from Rs.1,447.85 crore; PBT increased 15% to Rs.231.34 crore despite lower cement realizations.

• Group production and dispatches reached 10.3 million tonnes, including Chandrapur trial-run cement; total group capacity reached about 13 million tonnes.

• Operating focus remained on cement, productivity and cost control; operating margins were described as roughly double the industry level.

Financial highlights

• Sales Rs.1,583.01 crore vs Rs.1,447.85 crore; operating profit Rs.465.80 crore vs Rs.463.98 crore.

• PBT Rs.231.34 crore vs Rs.200.60 crore; PAT after deferred tax Rs.186.52 crore vs Rs.186.35 crore.

• Sales volume including exports rose 18% to 71.84 lakh tonnes; sales value rose 9%, while realization fell 7% on lower cement prices.

• Consolidated sales and services were Rs.197,939.51 lakh; consolidated profit for the year was Rs.18,667.64 lakh, including minority interest of Rs.697.14 lakh.

Outlook and guidance

• Cement demand grew about 12% in April–July 2002; demand growth was expected to continue for the rest of the year.

• Housing, roads and infrastructure, supported by low interest rates and housing finance growth, were expected to drive cement demand.

• Domestic cement consumption was forecast to grow at a CAGR of around 8% over the next couple of years; demand-supply conditions were expected to improve.

• ACEL expected improved profitability in FY 2002-03 following productivity gains and lower costs.