Birla Corporation (500335) Q4 04/05 earnings summary

Executive summary

• FY05 set records for turnover, cash profit, PBT and PAT; growth reflected higher volumes, improved realizations, operating efficiencies and cost controls.

• Cement production crossed 5 million tonnes for the first time, reaching 5.02 million tonnes.

Financial highlights

• Gross sales rose 15% YoY to Rs 1,342.64 crore; total income increased 13% to Rs 1,360.86 crore.

• Operating profit grew 45% to Rs 145.22 crore; profit before tax rose 125% to Rs 93.70 crore and PAT increased 109% to Rs 86.87 crore.

• Cash earnings increased 64% to Rs 123.53 crore; interest expense fell 14% to Rs 21.69 crore.

• Exports increased 71% YoY to Rs 93.83 crore; the proposed dividend was Rs 1.50 per share, or 15%.

Outlook and guidance

• Captive power plants at Satna and Chanderia and Durgapur capacity expansion were expected to be commissioned in Q2 FY06, barring unforeseen circumstances.

• Cement industry growth was expected at 7–8% annually for the next couple of years, with prices expected to remain stable; infrastructure and housing were key demand drivers.

• Jute outlook hinged on value-added products and exports; a better raw-jute crop was expected to stabilize input prices.

• Auto Trim pursued new business using internally developed one-step technology; negotiations were underway with vehicle manufacturers.