Huhtamaki India (509820) Q4 2003 earnings summary

Executive summary

• FY2003 net sales rose 18.8% to Rs.3,826.2 million; EPS increased to Rs.22.27 from Rs.20.06, with growth driven by innovation, market expansion and higher volumes.

• Despite price pressure from FMCG customers and firm raw-material costs, profit before tax and profit after tax increased; the outlook remained cautiously optimistic on both top and bottom lines.

Financial highlights

• Gross turnover reached Rs.4,431.6 million versus Rs.3,758.9 million; net sales were Rs.3,826.2 million versus Rs.3,221.9 million.

• EBIT was Rs.385.1 million versus Rs.381.4 million; EBDIT was Rs.596.8 million versus Rs.579.6 million.

• Profit before tax rose to Rs.379.3 million from Rs.357.7 million; profit after tax was Rs.279.3 million versus Rs.251.5 million.

• Basic and diluted EPS increased to Rs.22.27 from Rs.20.06; cash EPS was Rs.39.16 versus Rs.35.87.

• Net external sales, excluding inter-unit sales, grew 18% to Rs.3,525 million; exports rose 25% to Rs.454 million.

Outlook and guidance

• Q1 2004 net sales grew ~12% YoY; quarterly EPS, not annualized, rose to Rs.5.37 from Rs.4.04.

• FY2004 outlook was cautiously optimistic on revenue and earnings, with demand expected to remain positive and consumer-packaging growth to sustain or improve.

• Planned FY2004 capex was Rs.450 million, including 50% flexibles-capacity expansion at Hyderabad and debottlenecking and innovation investments at Silvassa.

• Planned funding was a mix of internal accruals and some debt; inorganic growth opportunities remained under consideration, subject to viable terms and market conditions.