Deepak Nitrite (DEEPAKNTR) Q4 02/03 earnings summary

Executive summary

• FY03 sales and other income rose ~18%; higher volumes and operating efficiencies lifted profit, while exports grew 32% to Rs 7,850 lacs.

• Consolidated profit after tax was Rs 1,002.79 lacs; results include Aryan Pesticides from its acquisition in June 2002, limiting comparison with FY02.

Financial highlights

• Standalone gross profit before interest, depreciation and tax reached Rs 3,364.84 lacs, versus Rs 2,920.33 lacs in FY02.

• Standalone profit before tax was Rs 1,472.99 lacs; profit after tax was Rs 1,170.74 lacs, versus Rs 937.98 lacs and Rs 789.75 lacs, respectively.

• Consolidated profit before tax was Rs 1,286.32 lacs and profit after tax Rs 1,002.79 lacs, versus Rs 948.85 lacs and Rs 799.92 lacs in FY02.

• Standalone exports rose to Rs 7,850 lacs from Rs 5,930 lacs; consolidated outside-India revenue was Rs 8,060.13 lacs versus Rs 5,929.61 lacs.

Outlook and guidance

• More than half of FY03 capital expenditure went to fine chemicals; growth plans center on innovative chemistry and opportunities built on global customer confidence.

• Planned debottlenecking of existing products aims to preserve competitiveness amid lower customs duties and expected international competition.

• R&D priorities include value-added fine chemicals, process improvement and capacity ramp-up; one new product reached target capacity ahead of schedule.