EPL (500135) Q4 97/98 earnings summary

Executive summary

• FY98 sales and other income reached Rs 1,806.81 million vs Rs 1,537.15 million; profit after tax was Rs 259.99 million vs Rs 208.40 million.

• Domestic leadership continued alongside expansion in India, China and Egypt; Goa and Silvassa began commercial operations during the year.

Financial highlights

• Sales and services were Rs 1,799.14 million vs Rs 1,526.78 million; total income was Rs 1,820.73 million vs Rs 1,512.13 million.

• Profit before tax was Rs 327.49 million vs Rs 265.90 million; tax provision was Rs 67.50 million vs Rs 57.50 million; net income was Rs 259.99 million vs Rs 197.47 million in the audited P&L.

• Cash profit was Rs 460.90 million vs Rs 375.89 million; proposed final dividend was 32%, taking the year's declared/proposed dividend rate to 52%.

Outlook and guidance

• Guangzhou targeted 30 million tubes in calendar 1998 and break-even, with orders booked for 11 million tubes and additional capacity planned by year-end.

• Management expected recent capacity additions to temporarily weigh on return on capital employed, with returns expected to strengthen in following years.

• Investment in the Egyptian venture could rise to 75% for up to US$500,000, subject to approvals; ownership was previously 35%.