Tube Investments of India (TIINDIA) Q4 96/97 earnings summary

Executive summary

• FY1996-97 sales were nearly flat at Rs. 60,005.42 lakh; operating profit rose, while profit after tax fell amid higher interest and depreciation.

• Higher-value products, cost controls and new capacity supported operations; demand weakness affected bicycles and roll-formed products.

• Total dividend recommended was Rs. 2.50 per share, including the interim dividend, equal to 25% on enhanced capital.

Financial highlights

• Sales Rs. 60,005.42 lakh versus Rs. 60,167.15 lakh in FY1995-96; other income Rs. 1,121.23 lakh versus Rs. 1,019.18 lakh.

• Operating profit Rs. 5,592.03 lakh, up from Rs. 4,892.17 lakh; interest expense increased to Rs. 1,458.73 lakh from Rs. 339.42 lakh.

• Profit before tax was Rs. 2,410.64 lakh versus Rs. 3,226.41 lakh; profit after tax was Rs. 2,144.64 lakh versus Rs. 2,796.41 lakh.

• Excluding the Rs. 106.51 lakh voluntary retirement payment, FY1996-97 profit before tax was Rs. 2,410.64 lakh before that charge.

• EPS was Rs. 8.71; financial highlights report revenue of Rs. 61,127 lakh and dividend of Rs. 616 lakh for FY1996-97.

Outlook and guidance

• Tube division price increases were being pursued for FY1997-98 to offset input-cost increases.

• Wide-width cold-rolled strip project capacity is 55,000 tonnes p.a.; phase one was commissioned in April 1997, with operations expected from August 1997.

• Tube exports were expected to rise from FY1997-98 following EOU commissioning; focus markets include Europe, Australia and the U.S.

• Rs. 30 lakh planned for FY1997-98 energy-saving measures, expected to generate recurring annual savings of Rs. 21 lakh.

• Door-frame project for Maruti cars, developed with Edward Rose Ltd., was budgeted at Rs. 16.39 crore and expected to commission by January 1998.