V-Guard Industries (532953) Q4 06/07 earnings summary

Executive summary

• Gross sales rose 31% YoY to Rs. 241.16 crore; net profit after tax increased, supported by broad-based product performance and expanded national distribution.

• Electronic Voltage Stabilizers reached sales of Rs. 105.95 crore and one million units, a milestone for the year.

• Expansion plans included new regional manufacturing capacity, stronger R&D and an IPO proposal to fund part of the investment.

Financial highlights

• Gross sales were Rs. 24,115.52 lakh vs Rs. 18,407.71 lakh; net sales after discounts were Rs. 22,922.04 lakh vs Rs. 17,522.36 lakh.

• P&L turnover after excise duty was Rs. 22,227.48 lakh vs Rs. 16,972.80 lakh; operating profit before depreciation, interest and tax was Rs. 2,708.58 lakh vs Rs. 1,912.81 lakh.

• Profit before tax was Rs. 2,049.90 lakh vs Rs. 1,425.86 lakh; PAT before exceptional items was Rs. 1,332.23 lakh vs Rs. 920.48 lakh.

• Net profit was Rs. 1,823.93 lakh, including Rs. 491.70 lakh net-of-tax profit on investment sales; prior-year net profit was Rs. 920.48 lakh.

• Operating cash flow was Rs. 424.78 lakh vs Rs. 1,238.22 lakh; higher working-capital investment reduced cash generated from operations.

Outlook and guidance

• FY 2007-08 outlook was described as good; planned expansion included new manufacturing facilities and a stronger R&D function to improve quality and add products.

• Plans included an LT power cable factory in Coimbatore, a domestic cable unit in Uttaranchal or Himachal Pradesh, R&D facilities in Himachal Pradesh and Coimbatore, and a wider India distribution and service network.