Maharashtra Seamless (500265) Q4 04/05 earnings summary

Executive summary

• FY05 gross turnover reached Rs. 879.28 crore, up 54% YoY; PBT rose 20% to Rs. 126.24 crore and PAT after adjustments to Rs. 85.14 crore.

• Expansion into 14-inch seamless pipes was commissioned, adding 100,000 tonnes of installed capacity; billet backward integration and a Hydril joint venture advanced strategic growth plans.

Financial highlights

• Gross turnover was Rs. 879.28 crore versus Rs. 569.01 crore; net sales and operating income were Rs. 769.41 crore versus Rs. 491.28 crore.

• Profit before depreciation was Rs. 136.74 crore versus Rs. 112.06 crore; depreciation was Rs. 10.50 crore versus Rs. 6.98 crore, and PBT was Rs. 126.24 crore versus Rs. 105.08 crore.

• PAT was Rs. 84.88 crore versus Rs. 71.46 crore; after prior-period adjustments and tax provision write-backs, PAT was Rs. 85.14 crore versus Rs. 71.75 crore.

• Interest and finance charges increased to Rs. 3.81 crore from Rs. 1.97 crore; reserves and surplus rose to Rs. 283.99 crore from Rs. 215.27 crore.

Outlook and guidance

• Higher crude prices, rising exploration and drilling activity, new domestic gas discoveries, pipeline expansion and infrastructure growth were expected to support pipe demand.

• The 14-inch mill positioned production to serve higher-diameter seamless pipe demand previously regulated by imports; the outlook also cited export-market growth.

• The Orissa billet project was planned in two phases by end-2007, with 500,000 TPA capacity and Rs. 550 crore aggregate capital outlay; full captive raw-material needs were targeted.