Lords Chloro Alkali (500284) Q4 10/11 earnings summary

Executive summary

• FY2010-11 sales rose 16% YoY to ₹13,264.34 lakh; net profit was ₹139.46 lakh versus a ₹10.70 lakh loss in FY2009-10.

• Restarted TCE production, sold 1,230 MT, and generated ₹968 lakh of TCE turnover; hydrogen gas sales rose to 93 MT from 58 MT.

Financial highlights

• Sales ₹13,264.34 lakh versus ₹11,428.60 lakh; other income fell to ₹233 lakh from ₹994.42 lakh.

• Operating profit before interest, depreciation and exceptional items was ₹836.79 lakh versus ₹518.79 lakh; net profit ₹139.46 lakh versus a ₹10.70 lakh loss.

• PBT was ₹291.80 lakh versus a ₹27.33 lakh loss; EPS was ₹0.55 versus a ₹0.04 loss per share.

• Operating cash flow was ₹235.47 lakh versus an outflow of ₹676.43 lakh; closing cash and equivalents were ₹30.94 lakh.

Outlook and guidance

• FY2011-12 domestic demand growth was forecast at 8%-10%; no new caustic soda capacity was expected industry-wide, with prices for caustic soda and chlorine expected to remain upward.

• Caustic soda output of 60,000 MT and stable bleaching powder output of 8,000 MT were expected in FY2011-12.

• Brownfield caustic soda expansion of 110 TPD was targeted for completion in FY2011-12, taking capacity from 227 TPD to 337 TPD; TCE production was targeted to reach 300 MT/month.

• Restarted TCE production was expected to reach 350-450 MT/month; revamping, refurbishment and efficiency improvements were intended to reduce costs and improve profitability.