Bosch India (BOSCHLTD) Q4 2006 earnings summary

Executive summary

• Sales revenue €43.684bn in FY 2006, up 5.4% YoY; profit before tax €3.081bn versus €3.178bn in 2005.

• Uneven sector performance: strong growth in Consumer Goods and Building Technology and Industrial Technology offset weaker Automotive Technology results.

• The 2007 target was organic sales growth at a similar rate to 2006 and earnings at the prior-year level.

Financial highlights

• Gross profit €13.458bn versus €13.112bn; operating profit €2.416bn versus €2.493bn.

• Profit after tax from continuing operations was €2.170bn versus €2.342bn; total profit after tax was €2.170bn versus €2.450bn, including €108m from discontinued operations in 2005.

• Financial result was €665m versus €685m; income tax expense was €911m versus €836m.

• Operating cash flow increased to €3.681bn from €3.440bn; investing cash flow was -€3.277bn and financing cash flow -€614m.

Outlook and guidance

• FY 2007 organic sales target: growth at a similar rate to 2006, provided there is no further substantial euro appreciation; earnings targeted at the prior-year level.

• Pricing pressure was expected to persist; cost reduction across operating units was planned to protect results.

• Capital expenditure was planned at a similar scale in 2007 and 2008, with Automotive Technology remaining the main focus.

• Global growth was expected to moderate in 2007, while automotive production growth was forecast at 3%; emerging economies were expected to provide the strongest impetus.