Galaxy Surfactants (GALAXYSURF) Q4 07/08 earnings summary

Executive summary

• FY2007-08 net sales rose 18.41% YoY to ₹38,210.92 lakh; net profit after tax increased to ₹2,639.75 lakh from ₹2,524.10 lakh.

• Export growth, capacity debottlenecking and specialty-product development supported expansion, while input-cost inflation, rupee appreciation and a six-week plant shutdown pressured profits.

Financial highlights

• Domestic sales grew 9.50% to ₹16,491.97 lakh; export sales grew 26.20% to ₹21,718.95 lakh.

• Gross profit before interest and depreciation was ₹5,401.54 lakh; PBT was ₹3,363.98 lakh and EPS was ₹30.82 versus ₹29.47 YoY.

• PBT included a ₹336.39 lakh abnormal charge for assets scrapped during Taloja debottlenecking and corporate-office renovation.

• Proposed dividend: 50%, or ₹5 per share; total dividend and distribution-tax outgo of ₹500.95 lakh.

Outlook and guidance

• FY2008-09 capital outlay of ₹2,790.92 lakh planned for further debottlenecking, stronger R&D facilities and entry into new specialty products.

• Growth priorities include customized products, customer proximity and evaluating offshore manufacturing opportunities in developed and emerging markets.

• SAP Business Intelligence was expected to become operational in H2 of the next accounting year; Adrenalin software was being implemented for people-management data.

• Management expressed confidence in sustaining domestic growth and export momentum through customer partnerships, R&D and new export products.