Linde India (523457) Q4 03/04 earnings summary

Executive summary

• FY04 delivered stronger operating performance, with gross sales up 8% and operating profit before tax and extraordinary items up 76% YoY; property-sale gains lifted reported PBT to Rs 436.91m.

• Improved operating cash generation and lower borrowings reduced interest costs, while a 10% dividend was recommended.

Financial highlights

• Gross sales reached Rs 3,471.75m vs Rs 3,222.73m; underlying sales growth was 10% after adjusting for revenue de-escalation from lower power tariffs.

• Operating profit after depreciation and interest, before tax and extraordinary items, was Rs 201.38m vs Rs 114.60m, up 76% YoY.

• PBT rose to Rs 436.91m from Rs 199.80m, including Rs 253.24m extraordinary profit on property disposal; PAT increased 79% to Rs 292.92m.

• Operating cash flow was Rs 626.26m vs Rs 420.20m; borrowings fell 26% and net working capital fell 29%.

Outlook and guidance

• Operational performance was expected to improve in FY05, supported by the Jamshedpur plant, efficiency initiatives and growth opportunities across industrial and medical applications.

• Strong steel demand and capacity expansion were expected to support gases demand; attractive investment opportunities were being evaluated, backed by robust cash flows and low gearing.