Timex Group India (500414) Q4 00/01 earnings summary

Executive summary

• FY2000-01 sales were Rs. 6,524.89 lakh and net loss was Rs. 4,755.16 lakh; prior-year sales were Rs. 9,205.34 lakh and net loss Rs. 1,375.38 lakh.

• Accumulated losses exceeded 50% of peak net worth over the preceding four years, requiring a reference to BIFR under SICA; management characterized the reference as technical.

Financial highlights

• Total income was Rs. 6,876.83 lakh versus Rs. 9,432.68 lakh; total expenditure was Rs. 11,631.99 lakh versus Rs. 10,808.06 lakh.

• Interest expense was Rs. 955.65 lakh, down from Rs. 1,144.60 lakh; depreciation rose to Rs. 1,899.83 lakh from Rs. 519.65 lakh.

• Exceptional and prior-period items totaled Rs. 2,502.64 lakh, including accelerated depreciation, inventory write-downs and sales returns.

• Year-end net worth was Rs. 8,068.45 lakh; accumulated losses on the balance sheet were Rs. 7,587.30 lakh.

Outlook and guidance

• Management expected the international product collection to support future sales volume and value, and planned to strengthen retail merchandising and distribution.

• A further preferential equity issue equivalent to US$4 million was planned to improve net worth, lower debt costs and support operations, subject to approvals.

• Management cited product-line revamping, fuller plant utilization, parts internalization and ongoing cost reduction as measures to improve performance.