Hindalco Industries (HINDALCO) Q4 00/01 earnings summary

Executive summary

• FY01 delivered record metal output of 251,492 tonnes, net sales growth of 12% and net profit growth of 10.7%, supported by better realisations, product mix and operating efficiency.

• Strategic focus centered on integrating Indal, capturing synergies and expanding Renukoot capacity; the first expansion phase targeted 15,000 tonnes of incremental metal output in FY02.

Financial highlights

• Net sales rose 12% YoY to Rs.22,754.0 million; gross turnover also increased 12% to Rs.25,836.2 million.

• Operating profit (PBDIT) increased 12% to Rs.10,528.5 million; operating margin held at 46.3% despite higher input costs.

• Net profit rose 10.7% to Rs.6,780.8 million; excluding FY00 greenfield project expenses of Rs.227.9 million, PAT before extraordinary items grew 6.8% to Rs.6,780.8 million.

• EPS increased to Rs.91.1 from Rs.82.2 and CEPS to Rs.110.2 from Rs.100.4; exports grew 20.5% to Rs.3,763.3 million.

Outlook and guidance

• Renukoot expansion was scheduled for phased completion largely by end-FY03; first-phase commissioning was expected in FY02, adding 15,000 tonnes of metal output.

• Project Rocket 2K targeted annual savings of Rs.400–500 million over two years through higher throughput, efficiency gains, lower costs and reduced working capital.

• Business returns were expected to improve as Indal synergies materialised and brownfield expansion contributed; growth priorities included efficiency, cost competitiveness and value-added products.