Honeywell Automation India (517174) Q4 2006 earnings summary

Executive summary

• FY06 sales grew 31% YoY, EBITDA 70%, and EPS 70%; all segments grew in similar proportions.

• PAT reached Rs 580.1m, while operating cash flow was Rs 762.9m, equal to 131% of net income.

• Growth initiatives, localization and working-capital discipline supported performance; outlook remained tied to continued investment in industry, infrastructure and construction.

Financial highlights

• Net sales were Rs 6,439.5m for the year ended Dec. 31, 2006, up from Rs 4,930.0m in 2005; sales and other income totaled Rs 6,683.8m.

• Operating profit was Rs 900.0m versus Rs 527.0m; PBT was Rs 776.5m versus Rs 380.1m.

• PAT was Rs 580.1m versus Rs 340.8m; basic/diluted EPS was Rs 65.61 versus Rs 38.55.

• Proposed dividend was Rs 10 per share, described as a 100% increase; Rs 100m was transferred to general reserve.

Outlook and guidance

• HPS expected high growth to continue in FY07, supported by industrial expansion, power generation, metals investment, refinery expansions and Euro 3/4 compliance projects.

• More than 1,200 petrol stations were confirmed for automation in 2007; expanded manufacturing facilities were expected to be completed by June 2007.

• Novar building-control system integrators were targeted for expansion in 2007; 10 had been appointed by year-end 2006.