Godrej Consumer Products (GODREJCP) Q4 03/04 earnings summary

Executive summary

• FY 2003-04 delivered 7% growth in branded sales, 21% PAT growth and EVA of Rs. 53.7 crore, despite muted FMCG conditions.

• Consumer-focused, affordable product launches and efficiency gains supported performance; Baddi manufacturing capacity and tax benefits strengthened the platform for growth.

Financial highlights

• Total sales rose 4% to Rs. 489.6 crore; Godrej brand sales rose 7% to Rs. 463.7 crore.

• PBDIT increased 8% to Rs. 88.4 crore; PBT was Rs. 76.6 crore, up 9%, and PAT was Rs. 64.8 crore, up 21%.

• EPS was Rs. 11.35 versus Rs. 9.16; EVA rose to Rs. 53.7 crore from Rs. 41.7 crore.

• Total dividend was Rs. 9 per share, equal to 225% of the Rs. 4 face value.

Outlook and guidance

• FY 2004-05 outlook cited strong GDP growth and a good monsoon as potential drivers of consumer spending and improved FMCG performance.

• Soap growth opportunity supported by low market share, distribution reach and vegetable-oil procurement expertise; hair colour and liquid detergents had low penetration and room to expand.

• Baddi soap plant capacity was 15,000 tonnes, with plans to double it in FY 2005; savings from Baddi and Guwahati tax benefits were slated for product and operational development.