Borosil Renewables (BORORENEW) Q4 04/05 earnings summary

Executive summary

• FY2004-05 returned to profit despite furnace downtime and suspended operations at Maraimalai Nagar; a 10% dividend was recommended after a nine-year gap.

• Furnace No. 1 rebuild at Marol cost Rs. 14.22 crore and increased capacity to 22 MT/day, improving glass quality and fuel efficiency.

Financial highlights

• Gross sales including excise were Rs. 6,303.19 lakh, down from Rs. 6,510.88 lakh YoY; net sales were Rs. 5,845.21 lakh versus Rs. 6,169.04 lakh.

• PBT was Rs. 98.08 lakh versus a loss of Rs. 80.17 lakh; PAT was Rs. 232.41 lakh versus Rs. 10.97 lakh.

• Operating profit before interest, depreciation and extraordinary items rose to Rs. 613.95 lakh from Rs. 522.25 lakh; EPS was Rs. 6.78 versus Rs. 0.32.

• Exports increased to Rs. 366 lakh from Rs. 295 lakh; a 10% dividend, or Re. 1 per equity share, was recommended.

Outlook and guidance

• Rebuilt Furnace No. 1 is expected to support substantially higher profitability in FY2005-06 through better quality and lower fuel costs, despite limited expected production growth.

• Domestic scientific and industrial growth remains constrained; expanded sub-contracting and exports are intended to improve product availability and offset the domestic growth limit.

• Consumerware focus remains microwave glassware and higher-quality drinking glasses, where further market growth is expected.