HeidelbergCement India (500292) Q4 2009 earnings summary

Executive summary

• FY2009 cement sales reached 2.66 million tonnes vs 2.42 million tonnes in FY2008; gross sales rose 17.42% to Rs. 104,023.92 lacs and net profit to Rs. 13,403.91 lacs.

• Comparisons with FY2008 are not strictly like-for-like: prior-year results included the merged businesses only from April to December 2008.

Financial highlights

• Gross sales were Rs. 104,023.92 lacs vs Rs. 88,697.67 lacs; net sales were Rs. 93,639.29 lacs vs Rs. 76,129.61 lacs in FY2008.

• Net profit was Rs. 13,403.91 lacs vs Rs. 12,552.64 lacs; profit before tax from continuing operations was Rs. 17,474.87 lacs vs Rs. 10,672.62 lacs.

• Operating surplus was Rs. 20,495.46 lacs vs Rs. 13,310.34 lacs; reported finance charges were Rs. 439.90 lacs and depreciation/amortization Rs. 2,580.69 lacs.

• Other income included Rs. 1,175.62 lacs from certified emission rights; the FY2008 result included Rs. 90.25 lacs profit from discontinued operations.

Outlook and guidance

• Cement demand was expected to remain firm in H1 2010, supported by housing and infrastructure; demand had improved at the start of Q1 2010, particularly in northern, western and central India.

• Commercial production from the Damoh and Jhansi expansion projects was expected in Q1 2012; completion was projected to double total cement capacity to 6 MTPA.

• Industry capacity was projected to reach 250–265 MTPA by end-2010, with expected annual industry growth of 9–10%; added capacity could pressure prices and utilization.