Maharashtra Seamless (500265) Q4 97/98 earnings summary

Executive summary

• FY98 gross turnover reached Rs. 15,530 lacs, up 10.2% YoY; PBT was Rs. 899 lacs, up 11.7% YoY.

• Production increased to 39,909 MT from 35,387 MT; second-shift operations began, and seamless-pipe range expanded to 7-inch OD from 5.5-inch OD.

• Directors proposed dividends of 10% on equity shares and 12% on cumulative convertible preference shares.

Financial highlights

• Sales were Rs. 1,509.4 million vs Rs. 1,378.1 million; total income was Rs. 1,435.0 million vs Rs. 1,466.6 million, reflecting lower inventory change.

• PBT rose to Rs. 89.93 million from Rs. 80.48 million; profit after tax and adjustment was Rs. 80.03 million vs Rs. 69.86 million.

• Interest and financial charges declined to Rs. 43.50 million from Rs. 54.79 million; depreciation was Rs. 30.94 million vs Rs. 30.03 million.

• Proposed equity and preference dividends were Rs. 25.50 million and Rs. 3.99 million, respectively; Rs. 55 million was transferred to general reserve vs Rs. 85 million.

Outlook and guidance

• Management cited a very good order book and expected the second shift to lift production, lower overheads and improve profitability.

• Product development extended seamless-pipe sizes from 5.5-inch to 7-inch OD; future R&D priorities include new sizes, quality upgrades, energy conservation and cost reduction.