Cummins India (500480) Q4 03/04 earnings summary

Executive summary

• FY 2003-04 standalone net sales rose 12% to Rs. 9,324 million; profit after tax increased 16% to Rs. 1,093 million.

• Growth reflected stronger domestic demand, export gains, cost initiatives and higher other income; rising metal prices partly offset these benefits.

Financial highlights

• Standalone PBT was Rs. 1,381 million, up 14%; net profit was Rs. 1,093 million versus Rs. 943 million, and EPS was Rs. 5.52 versus Rs. 4.76.

• Standalone net sales: domestic Rs. 7,107 million, up 9%; exports Rs. 2,217 million, up 28%; total Rs. 9,324 million, up 12%.

• Consolidated sales plus other income was Rs. 12,334 million versus Rs. 10,964 million; consolidated net profit was Rs. 967 million versus Rs. 889 million, with EPS of Rs. 4.88 versus Rs. 4.49.

• Export earnings increased 29% to Rs. 2,274 million; 3,511 engines were exported during the year.

Outlook and guidance

• Five-year objectives target aggressive sales and profit growth, supported by domestic share gains, export growth, lower-cost production and stronger workplace performance.

• Emission-compliant power-generation products, expanded gas gensets and new export programs were expected to support future growth; export programs were expected to have a strong impact over the next 24 months.

• B Gas International lean-burn automotive engines in the 145-230 HP range were planned for production from 2005, opening potential global natural-gas market opportunities.

• Management expected Indian GDP growth of 6.5%-7.0% and continued captive-power demand; forecasts depended on continued positive macroeconomic trends.