ESAB India (ESABINDIA) Q4 96/97 earnings summary

Executive summary

• FY1996-97 sales grew 12% and profit after tax rose 27% YoY despite a slowdown across industry and the organised welding sector.

• Exports increased 64%; sales and marketing coverage expanded, and welding consumables were reorganised into dedicated business groups.

Financial highlights

• Sales were Rs 1,590.377m and sales plus other income Rs 1,606.114m, versus Rs 1,425.571m and Rs 1,439.611m, respectively, in FY1995-96.

• Profit before tax was Rs 140.017m versus Rs 126.528m; profit after tax was Rs 82.697m versus Rs 65.028m.

• Proposed dividend was 20%, absorbing Rs 30.786m; dividend tax was Rs 3.079m.

• Operating cash flow increased to Rs 161.127m from Rs 67.879m; net cash and cash equivalents ended FY at Rs 259.994m.

Outlook and guidance

• The Union Budget and RBI credit policy were viewed as economic stimuli, with industrial production expected to improve.

• Future plans include combining ESAB technology with local expertise to improve quality and launch products in Indian and overseas markets.

• Flo-Tech directors were optimistic about the subsidiary's performance in the ensuing financial year.