Exide Industries (500086) Q4 97/98 earnings summary

Executive summary

• FY98 gross sales reached Rs 5,651.9 lacs? No: Rs 5,651.86 million; battery volumes rose 9%, led by replacement demand, despite a weak economic and automotive environment.

• Reported PBT was Rs 2,610.83 lacs and PAT Rs 2,335.83 lacs, down YoY; higher interest and depreciation from expansion and acquisitions weighed on earnings.

• Recommended dividend was 32%, or Rs 3.20 per share; EPS was Rs 8.10.

Financial highlights

• Sales were Rs 5,651.86 million versus Rs 5,093.85 million in FY97; other income was Rs 13.90 million versus Rs 20.48 million.

• Operating profit was Rs 7,887.11 lacs versus Rs 7,110.67 lacs; PBT fell to Rs 2,610.83 lacs from Rs 3,603.74 lacs, and PAT to Rs 2,335.83 lacs from Rs 3,092.77 lacs.

• Interest expense rose to Rs 2,799.87 lacs from Rs 2,131.56 lacs; depreciation increased to Rs 1,995.80 lacs from Rs 1,144.03 lacs.

• Reported results included Rs 265.92 lacs of exceptional items: VRS costs, prior-year insurance claims written off, and foreign-currency loan exchange loss.

• Operating cash flow was Rs 7,264.30 lacs; net cash used in investing was Rs 20,864.53 lacs, mainly reflecting fixed-asset purchases.

Outlook and guidance

• Management positioned new capacity and acquisition synergies to support rural-market penetration, lower dependence on the unorganised sector, and lower end-user prices.

• Prior projections were exceeded for gross income and profit before depreciation, interest and tax; PAT of Rs 2,335 lacs and EPS of Rs 8.10 were below projected Rs 3,180 lacs and Rs 11, citing higher depreciation and interest.

• Q1 FY99 net sales were Rs 13,197 lacs versus Rs 8,276 lacs YoY; PAT was Rs 544 lacs versus Rs 359 lacs, and EPS Rs 6.00 versus Rs 5.00.