The Indian Hotels Company (INDHOTEL) Q4 00/01 earnings summary

Executive summary

• FY 2000-01 total income rose 14% to Rs. 716.34 crore; profit after tax (PAT) increased 3% to Rs. 116.79 crore, with higher interest and depreciation limiting earnings growth.

• Fourth-quarter sales and other operating income grew 12% to Rs. 210 crore, while PAT rose 20% to Rs. 48 crore.

• Renovation, expansion and workforce resizing advanced strategic repositioning; a centenary-year final dividend of Rs. 10 per share was recommended.

Financial highlights

• Total income was Rs. 716.34 crore versus Rs. 630.59 crore; rooms income grew 12% and Food & Beverage income 16% YoY.

• Profit before depreciation, interest, tax and extraordinary items rose 18% to Rs. 217.13 crore; PBT increased 5% to Rs. 137.29 crore and PAT 3% to Rs. 116.79 crore.

• Sales and operating income increased 14% to Rs. 687 crore; EBITDA rose 20% to Rs. 188 crore from Rs. 157 crore, while PAT increased 3% to Rs. 117 crore.

• FY dividend recommended at 100%, or Rs. 10 per ordinary share, versus Rs. 8.50 per share in the prior year.

Outlook and guidance

• GDP was expected to grow ~6% in FY 2001-02, but mixed business sentiment and slower major economies pointed to subdued business travel and tighter corporate travel spending.

• Strategy centered on process improvement, technology and talent, while pursuing selective expansion in India and internationally to strengthen competitiveness and shareholder value.

• Wellington Mews serviced apartments were under construction, with completion expected within two years; construction permissions had been obtained.