ESAB India (ESABINDIA) Q4 00/01 earnings summary

Executive summary

• FY2000-01 sales rose 23% to Rs1,572.3m; restructuring and cost reductions supported a return to profit after a loss in FY1999-00.

• Exports grew 44%; the proposed dividend was 25%, absorbing Rs38.483m before dividend tax.

Financial highlights

• Sales and other income reached Rs1,591.868m, compared with Rs1,298.267m in FY1999-00.

• Profit before exceptional item and tax was Rs128.235m, versus a loss of Rs78.020m; Rs21.370m of voluntary separation and related costs reduced PBT to Rs106.865m.

• Net profit was Rs100.765m, versus a net loss of Rs199.326m; EPS was Rs6.55.

• Manufacturing, selling and administrative expenses declined to Rs419.078m from Rs478.288m; employee cost fell ~25%.

Outlook and guidance

• Weak investment sentiment and slow project implementation cloud near-term demand; directors called for measures to accelerate infrastructure projects and revive welding demand.

• Continued restructuring and modernization investments were expected to strengthen competitiveness; product quality, productivity and new products remained priorities.

• Financial year changed to calendar-year reporting: FY2001 covers Apr-Dec 2001, followed by Jan-Dec financial years from 2002.

• Subsidiary management expected its encouraging FY2001-02 order book to help recoup accumulated losses.