Linde India (523457) Q4 01/02 earnings summary

Executive summary

• FY02 sales rose 1% to Rs 3,037.9m; operating profit after depreciation and interest, before extraordinary items, increased 97% to Rs 35.5m.

• Net profit was Rs 25.8m, including a Rs 15m prior-year tax provision write-back; accumulated losses were expected to be eliminated in FY03.

• Cost controls, productivity gains, lower interest expense and working-capital improvements supported results despite weak industrial demand.

Financial highlights

• Sales were Rs 3,037.9m versus Rs 3,013.7m in FY01; operating profit before extraordinary items was Rs 35.518m versus Rs 18.065m.

• PBT was Rs 10.775m after net extraordinary charges of Rs 24.743m; PAT was Rs 25.775m versus Rs 18.065m.

• Extraordinary items included a Rs 130.299m Jamshedpur power fuel surcharge charge and Rs 105.556m gain on Mumbai property disposal.

• The Rs 15m excess tax provision write-back related to favourable assessments for prior years; EPS was Rs 0.53 basic and diluted versus Rs 0.37.

• Other income rose to Rs 48.396m from Rs 28.989m; expenses increased to Rs 2,017.563m from Rs 1,909.344m, including power and fuel costs of Rs 1,248.244m.

Outlook and guidance

• FY03 outlook was cautiously optimistic, with expected steel-sector recovery and reasonable growth in automobile and two-wheeler markets supporting shielding gases.

• Medical gases, Homecare, food freezing and fibre-optics applications were identified as growth opportunities to broaden the customer base.

• Barring unforeseen circumstances, performance was expected to improve in FY03; accumulated losses were expected to be eliminated during the year.

• Recent project wins were expected to add around Rs 600m to revenue over the following two years.