Radico Khaitan (RADICO) Q4 02/03 earnings summary

Executive summary

• FY 2002-03 sales and other income reached Rs. 5,384.80 million; PAT was Rs. 185.79 million, with reported annualized YoY growth of 30% and 57%, respectively.

• Brand growth, distribution expansion, cost controls and Rampur upgrades strengthened operating capacity; the year also saw completion of the reverse merger with Abhishek Cements.

Financial highlights

• Sales and other income were Rs. 5,384.80 million versus Rs. 5,191.86 million; prior-year period covered 15 months, and the reported annualized growth was 30%.

• Profit before depreciation and tax was Rs. 280.65 million; PBT was Rs. 234.39 million and reported PAT was Rs. 185.79 million, versus Rs. 211.99 million, Rs. 166.59 million and Rs. 149.09 million, respectively.

• Sales through tie-up units rose to Rs. 1,054.49 million from Rs. 959.80 million; reported annualized growth was 37%, and these sales were excluded from the standalone sales figure.

• Proposed equity dividend was 18%, versus 16% on an annualized basis in the prior year; proposed payout was Rs. 34.72 million.

Outlook and guidance

• Old Admiral VSOP brandy was projected to exceed 0.5 million cases in FY 2003-04 after selling 200,000 cases in its launch year.

• Ready-to-drink breezers and coolers were planned for the upper end of the target market; geographic expansion was underway into Jammu & Kashmir, Tamil Nadu and Nepal.

• ENA Deluxe was expected to open international sales opportunities, with management viewing ENA exports as a high-contribution revenue stream.

• Management expected industry growth to accelerate over the next 4–5 years as regulation liberalized, while anticipating stronger foreign-brand competition in premium categories.