Uflex (500148) Q4 05/06 earnings summary

Executive summary

• FY06 standalone net sales and job work were Rs.94,596.38 lakh; profit after tax rose to Rs.3,286.61 lakh from Rs.3,077.50 lakh, despite higher input costs and pressure on film margins.

• Consolidated net sales and job work reached Rs.106,611.07 lakh, with profit after tax of Rs.5,514.95 lakh; Dubai subsidiary commercial production began in FY06.

• The Board did not recommend a dividend, citing the overall financial scenario.

Financial highlights

• Standalone total income was Rs.101,402.58 lakh vs Rs.93,133.63 lakh; sales and job work increased 6.51% YoY, while other income rose to Rs.6,812.22 lakh from Rs.3,769.73 lakh.

• Standalone PBT was Rs.4,390.52 lakh vs Rs.5,166.56 lakh; PAT was Rs.3,286.61 lakh vs Rs.3,077.50 lakh.

• Consolidated total income was Rs.114,802.37 lakh vs Rs.94,541.15 lakh; PAT was Rs.5,514.95 lakh vs Rs.3,376.91 lakh.

• Consolidated net sales and job work were Rs.106,611.07 lakh vs Rs.89,732.77 lakh; other income was Rs.7,022.01 lakh and associate profit was Rs.147.46 lakh.

• Operating cash flow was Rs.8,876.74 lakh standalone and Rs.7,629.18 lakh consolidated; investing outflows were Rs.11,476.40 lakh and Rs.9,620.62 lakh, respectively.

Outlook and guidance

• Management expected continued growth in flexible packaging, supported by demand for packaged foods, smaller packs, hygiene awareness, new applications and cost-competitive Indian film production.

• Management expected cylinder business sales and profitability to benefit from the positive packaging-industry outlook.

• A further Dubai line was planned for 26,400 MT of polyester film and 59,400 MT of polyester chips; this was a planned expansion, not reported operating capacity.

• Four additional film types were at an advanced development stage and expected to launch commercially soon; no financial targets were stated.