Lords Chloro Alkali (500284) Q4 02/03 earnings summary

Executive summary

• FY03 sales were Rs 2,944.51 lakh, up from Rs 2,718.64 lakh; net loss was Rs 3,756.92 lakh, while caustic soda production increased to 15,140 MT from 14,437 MT.

• BIFR classified the business as sick and appointed IDBI as Operating Agency; a revival package and bids for change of management remained under consideration.

Financial highlights

• Sales were Rs 2,944.51 lakh vs Rs 2,718.64 lakh; other income was Rs 347.93 lakh vs Rs 209.87 lakh.

• Net loss after tax was Rs 3,756.92 lakh vs Rs 3,777.25 lakh; accumulated losses reached Rs 19,215.71 lakh vs Rs 15,458.79 lakh.

• Interest expense rose to Rs 3,261.93 lakh from Rs 2,801.18 lakh; depreciation was Rs 524.29 lakh vs Rs 561.54 lakh.

• Net cash used in operating activities was Rs 2,777.70 lakh; cash and cash equivalents closed at Rs 11.29 lakh vs Rs 53.09 lakh.

Outlook and guidance

• Industry capacity was expected to remain largely unchanged in the near term; demand-supply imbalance was expected to correct as end-user industries recovered.

• Improving chlorine demand, anti-dumping duties on some caustic soda imports and expected recovery in the chloro-alkali industry supported the outlook.

• Lower import tariffs to 10%/20% by 2004 were expected to increase cheap-import risk and pressure realizations; expected chlorine supply to EDC/PVC markets could improve realizations.