SRF (SRF) Q4 00/01 earnings summary

Executive summary

• FY2000-01 net profit rose 49.96% to Rs.40.19 crore; net sales increased 4.17% to Rs.692.86 crore, while operating profit before one-time charges declined.

• Debt fell to Rs.400.22 crore; debt-equity improved to 1.05x, and interest cost dropped to Rs.69.27 crore from Rs.94.93 crore.

• Competitive gains in Nylon Tyre Cord Fabric and growth in chloromethanes supported operating progress amid weak demand and depressed product prices.

Financial highlights

• Gross sales rose 1.7% to Rs.815.95 crore; net sales grew 4.17% to Rs.692.86 crore.

• PAT increased 49.96% to Rs.40.19 crore; PBT was Rs.42.48 crore versus Rs.31.30 crore, including a Rs.9.18 crore ESPS charge in FY2000-01.

• PBIDT fell to Rs.151.35 crore from Rs.172.72 crore; lower one-time charges and interest costs offset much of the operating decline.

• Operating cash flow was Rs.59.89 crore, down 39.42% YoY; exports totaled Rs.99.27 crore, or 12.17% of gross sales.

Outlook and guidance

• FY2001-02 outlook remained sluggish; pricing and margins were not expected to revive immediately, prompting continued cost reduction and capacity consolidation.

• Further debt reduction was planned for FY2001-02; growth opportunities would be pursued from an improved competitiveness and capability base.

• HCFC-22 demand was expected to grow domestically and internationally; R-134a exports were planned, with manufacturing conditional on viable volumes.

• Polyester Films capacity was fully utilised; healthy domestic growth and tighter global supply-demand were seen as near-term opportunities.