Huhtamaki India (509820) Q4 2005 earnings summary

Executive summary

• FY05 set records for sales, EBDIT, EBIT and cash earnings per share despite the Thane flood, high input costs and pricing pressure.

• Net sales rose 9.9% YoY and PAT rose to Rs.276.7m; export growth and new-product initiatives supported performance.

Financial highlights

• Gross sales were Rs.4,984.1m vs Rs.4,539.1m; net sales were Rs.4,328.6m vs Rs.3,940.2m in FY04.

• PBT before extraordinary items was Rs.386.9m; reported PBT after the Rs.8.0m flood loss was Rs.378.9m, vs Rs.336.5m in FY04.

• PAT was Rs.276.7m vs Rs.241.1m; reported EPS was Rs.22.07 vs Rs.19.23, while EPS excluding extraordinary items was Rs.22.71.

• EBDIT reached Rs.633.6m, EBIT Rs.384.2m and cash EPS Rs.41.96, all reported as FY05 records.

Outlook and guidance

• FY06 outlook remained cautious: firm raw-material prices and continued selling-price pressure, with an expectation of acceptable financial performance.

• North India Greenfield plant was expected to begin initial production in Q3 2006; full sales benefit was expected in the latter part of 2007.

• FY06 capex budget was Rs.535m, including Thane revival, specialized pouching, labels and cartons capacity, and a cost-effective power solution.

• Double-digit consumer-packaging demand and continued NASP innovation underpinned a positive longer-term outlook.