Balkrishna Industries (502355) Q4 05/06 earnings summary

Executive summary

• FY ended 31 Mar 2006 gross turnover and other income rose 26% YoY to Rs.638.61 crore; profit after tax increased to Rs.69.95 crore from Rs.57.48 crore.

• Tyres drove growth, while paperboard output and sales were disrupted by floods; capacity additions and planned expansions were expected to support future tyre growth.

Financial highlights

• Net sales and income from operations were Rs.620.01 crore vs Rs.488.04 crore; total income was Rs.625.81 crore vs Rs.493.32 crore.

• PBIDT was Rs.145.81 crore vs Rs.117.71 crore; PBT was Rs.106.74 crore vs Rs.88.37 crore; PAT was Rs.69.95 crore vs Rs.57.48 crore.

• EPS before extraordinary items was Rs.36.95 vs Rs.30.96; no extraordinary item was recorded in FY06, compared with Rs.5.66 crore in FY05.

• Dividend totaled 100%, or Rs.10 per Rs.10 share, including interim dividends of Rs.7 and a recommended final dividend of Rs.3.

Outlook and guidance

• Expanded tyre capacity, broader product range and market development were expected to sustain healthy tyre-business growth, with fuller benefits of capacity and product mix expected in coming years.

• Tractor radial tyre capacity was being doubled; Bhiwadi capacity expansion to 48,000 tpa was scheduled for completion by Sep 2006.

• Chopanki planned 30,000 tpa additions in two phases, scheduled for Oct–Dec 2006 and Jan–Mar 2007; Waluj capacity was to rise from 18,000 to 22,000 tpa by Oct–Dec 2006.

• Textile processing performance was expected to improve further in FY07; coated paperboard remained pressured by industry overcapacity and competition.