The Supreme Industries (SUPREMEIND) Q4 03/04 earnings summary

Executive summary

• FY 2003-04 net sales were Rs. 796.27 crore; net profit was Rs. 21.07 crore, up from Rs. 14.28 crore YoY. Polymer processing volume rose to 100,053 MT.

• Converted volume, excluding discontinued BOPP operations, grew 11.36% YoY; exports reached $11.22 million, versus $7.63 million.

Financial highlights

• Net sales rose to Rs. 796.27 crore from Rs. 693.37 crore; total income reached Rs. 798.69 crore from Rs. 697.17 crore.

• Profit before tax and exceptional items increased to Rs. 22.09 crore from Rs. 18.55 crore; profit after tax was Rs. 20.99 crore versus Rs. 15.01 crore.

• Net profit, including prior-year adjustments and depreciation provision write-back, was Rs. 21.07 crore versus Rs. 14.28 crore.

• Operating profit was Rs. 87.90 crore versus Rs. 86.47 crore; interest expense declined to Rs. 24.42 crore from Rs. 31.44 crore.

• Recommended dividend increased to Rs. 9 per share, or 90%, from Rs. 7 per share, or 70%, in the prior year.

Outlook and guidance

• Overall converted volume is expected to grow 14% in FY 2004-05; plastics piping growth is targeted at a minimum 20% annually for five years.

• FY 2004-05 capital expenditure was projected at ~Rs. 55 crore, focused on piping, food serviceware, flexible and protective packaging, and injection moulding capacity.

• Cross-laminated film volume was expected to grow 25%; protective packaging was forecast to grow by more than 15%, with packaging film exports targeted above 500 tonnes.

• Flexible packaging film capacity was planned to increase by over 2,000 TPA; protective packaging plans included 1,500 TPA of EPE foam and 1,800 TPA of air-bubble film capacity.