Coromandel International (COROMANDEL) Q4 01/02 earnings summary

Executive summary

• FY 2001-02 delivered record production, sales and operating profit despite weak demand in addressable markets, price competition and poor liquidity.

• Revenue rose 10.9% to Rs.679.71 crore; profit after tax fell to Rs.45.54 crore, mainly reflecting a Rs.25.42 crore ammonia-plant write-off and higher tax provision.

• Fertiliser market share increased from 11.1% to 12.5% in addressable markets; Andhra Pradesh share for Complex 20:20:0 rose from 15% to 27%.

Financial highlights

• Total income was Rs.679.71 crore versus Rs.612.82 crore; operating income was Rs.650.60 crore versus Rs.598.79 crore.

• Profit before interest, depreciation and tax was Rs.133.43 crore versus Rs.106.49 crore; profit before extraordinary item and tax was Rs.98.50 crore versus Rs.70.38 crore.

• Adjusted for the Rs.25.42 crore ammonia-plant write-off, profit before tax was Rs.98.50 crore; reported profit before tax was Rs.73.08 crore.

• Net income was Rs.45.54 crore versus Rs.52.88 crore; EPS was Rs.23.41 versus Rs.27.18.

• Sales of complex fertilisers were 582,736 MT; total sales of complex fertilisers, MOP and SSP reached 661,321 MT, while aggregate volume including other products was reported at 6.74 lakh MT.

Outlook and guidance

• Phosphatic fertiliser demand was expected to grow ~4% nationally and in addressable markets over the next three years; supply was expected to exceed demand as new and expanded capacity came on stream.

• Plans targeted market penetration and expansion to sustain and increase share, supported by customer service, cost competitiveness, operating efficiency and brand strength.

• Growth opportunities included acquiring existing phosphatic fertiliser units, particularly on the eastern coast, and potential finished-fertiliser trading.

• Proposed projects included a modern ship unloader, 5,000 MT molten sulphur storage and plant upgrades to increase flexibility, reduce costs and support capacity utilisation of 7 lakh MT p.a.