CRISIL (CRISIL) Q4 00/01 earnings summary

Executive summary

• FY2000-01 operating income rose 29.43% YoY to Rs 4,397.83 lacs, while profit before tax fell 30.38% to Rs 1,338.44 lacs and profit after tax fell 25.18% to Rs 966.44 lacs.

• Ratings remained the largest revenue stream; advisory and research/information grew faster, broadening the revenue mix.

• A 55% dividend was recommended despite lower profits, with management citing expected operating buoyancy ahead.

Financial highlights

• Total income was Rs 5,153.73 lacs, up 27.79% YoY; operating income was Rs 4,397.83 lacs, up 29.43%.

• Profit before depreciation and tax was Rs 1,876.60 lacs, including a Rs 90 lacs contingency provision write-back; excluding the write-back, profit before extraordinary items was Rs 1,786.60 lacs.

• PBT fell 30.38% to Rs 1,338.44 lacs; PAT fell 25.18% to Rs 966.44 lacs, and EPS was Rs 15.59.

• Extraordinary items included gains on sale of fixed assets and property rights, and losses on sale of investments and fixed assets.

• Staff strength rose to 252 from 202; revenue per employee was Rs 20.45 lacs versus Rs 19.97 lacs YoY.

Outlook and guidance

• Management expected operating buoyancy and maintained the 55% dividend recommendation despite lower FY2000-01 profits.

• Securitisation ratings were expected to drive growth, supported by new products, potential legislation, capital-adequacy needs and further auto-securitisation and MBS activity.

• Financial-sector ratings were expected to grow as retail asset financing, new primary dealers, NBFC foreign investment and insurance-sector opening created opportunities.

• Greater engagement with Standard & Poor's was expected in ratings and information services; the subsidiary operating the web business targeted break-even in the next financial year.

• Internal accruals and liquid assets were expected to fund fixed-asset and infrastructure investment, with borrowing possible if considered necessary.