Max Financial Services (MFSL) Q4 97/98 earnings summary

Executive summary

• A 13-month year to Apr. 30, 1998 followed major portfolio restructuring and a shift toward sustainable shareholder value; management engaged McKinsey to shape future strategy.

• Sale of a 40% stake in Hutchison Max Telecom generated Rs. 5,495 million for the wholly owned telecom subsidiary, materially strengthening its financial resources.

Financial highlights

• Revenue was Rs. 1,298.39 million and net profit Rs. 85.68 million for the 13 months ended Apr. 30, 1998; prior-year figures cover 12 months and are not directly comparable.

• PBT was Rs. 106.03 million; reported profit on sale of business was Rs. 153.70 million, including Rs. 121.20 million from the Beta-Lactam facilities transfer.

• Operating cash flow was negative Rs. 277.98 million; net cash increased Rs. 63.83 million to Rs. 56.86 million after cash credit balances.

Outlook and guidance

• Strategy focused on consolidating existing businesses, pursuing new opportunities, diversifying risk and improving resource allocation, governance and management supervision.

• Export growth remained a priority for Max Pharma; plans included a UK subsidiary to support pharmaceutical and specialty-product exports and develop Western markets.

• Max GB planned 1,000 TPA Amoxycillin capacity, supported by technology and global market access; management expected HMGB’s depressed market conditions to improve gradually.