Huhtamaki India (509820) Q4 2019 earnings summary

Executive summary

• FY2019 revenue from operations rose 9% YoY to ₹25,823.7 million; EBIT increased 45.8% to ₹2,227.1 million and PAT reached ₹1,700.4 million.

• Stronger product mix, operating performance and lower interest costs supported earnings; a prior-year tax and interest provision was also written back after a favorable court order.

Financial highlights

• Sales were ₹2,547.67 crore versus ₹2,332.11 crore in 2018; EBITDA rose to ₹309.64 crore from ₹238.09 crore.

• PBT before exceptional items increased 77.5% to ₹201.58 crore; PAT rose to ₹170.04 crore from ₹34.88 crore.

• Revenue from operations, including other operating revenue, was ₹2,582.37 crore; reported EPS was ₹22.52 versus ₹4.62.

• Adjusted for the favorable write-back of ₹21.07 crore income tax and ₹10.00 crore related interest, earnings growth also reflected higher sales, improved mix and operations.

Outlook and guidance

• Strategic priorities centered on growth, competitiveness, talent and sustainability, with investment in production infrastructure, digitalisation and HR processes.

• COVID-19 was expected to affect future operations; the scale of impact depended on the pandemic’s development and its effects on business.

• The board revised its FY2019 final dividend recommendation from ₹5 to ₹3 per share in May 2020 to conserve resources amid the COVID-19 slowdown.