The Indian Hotels Company (INDHOTEL) Q4 05/06 earnings summary

Executive summary

• FY06 standalone income rose 29% to ₹1,127.57 crore; PAT increased 74% to ₹183.78 crore, with room-rate gains and lower interest costs supporting results.

• Consolidated income grew 40% to ₹1,874.73 crore and PAT after minority interest and associate profits rose 94% to ₹248.74 crore.

Financial highlights

• Standalone room revenue increased 33% to ₹563.35 crore; food and beverage income rose 21% to ₹406.36 crore.

• Standalone operating expenses rose 17% to ₹777.41 crore, below the 29% increase in income; gross profit/EBITDA increased 73% to ₹358.26 crore.

• Standalone profit before extraordinary items and tax was ₹272.00 crore vs ₹118.69 crore; PAT was ₹183.78 crore vs ₹105.86 crore.

• Consolidated diluted EPS increased to ₹42.41 from ₹22.47; standalone basic EPS before extraordinary items was ₹31.47 vs ₹20.06.

Outlook and guidance

• FY07 outlook was positive, citing bullish economic conditions, stronger domestic and global tourist traffic, and a favourable domestic hotel demand-supply position.

• Expected growth drivers included business travel, India’s appeal as a destination, the 2010 Commonwealth Games and potential hotel opportunities in Special Economic Zones.

• Langkawi and Bhutan hotels were expected to open in FY07; Ginger launches were planned in five cities by FY07-end.