Godfrey Phillips India (500163) Q4 04/05 earnings summary

Executive summary

• FY2004-05 sales turnover reached Rs.1,296 crore, up 10% YoY; PBT was Rs.99.95 crore and PAT Rs.63.60 crore.

• Cigarette sales volume rose 3% to 12,195 million sticks; tea volumes grew 30%, while cigar volumes tripled.

• Board recommended a Rs.22/share dividend, up from Rs.19; EPS was Rs.61.16 versus Rs.50.18.

Financial highlights

• Net sales were Rs.682.96 crore versus Rs.624.65 crore; gross sales were Rs.1,295.70 crore versus Rs.1,176.52 crore.

• PBT increased to Rs.99.95 crore from Rs.76.49 crore; PAT rose to Rs.63.60 crore from Rs.52.18 crore.

• Gross profit was Rs.116.50 crore versus Rs.86.43 crore; depreciation was Rs.16.55 crore versus Rs.9.95 crore.

• Cigarette sales volume was 12,195 million sticks versus 11,867 million, up 3%; Q1 FY2005-06 volume rose 9.3% YoY to 3,117 million.

• Exports including tobacco, cigarettes and tea were Rs.72.53 crore versus Rs.69.50 crore; export earnings including other income totaled Rs.73.87 crore.

Outlook and guidance

• FY2005-06 export target: 30% growth in cigarettes and cut tobacco; unmanufactured tobacco export target of Rs.58 crore.

• Q1 FY2005-06 cigarette sales value rose over 12% YoY to Rs.328.96 crore; tea sales reached Rs.7.96 crore, up 2%, with the first two months affected by VAT.

• Future cigarette consumption was expected to improve with economic growth and rising purchasing power, conditional on pragmatic, stable government policy.