V-Guard Industries (532953) Q4 07/08 earnings summary

Executive summary

• FY08 revenue from operations rose 25.12% YoY to Rs.27,811 lakh; PAT was Rs.3,742.31 lakh, including significant gains on land and investment sales.

• Expansion focused on North India, product range growth and new manufacturing, R&D, distribution and service capacity; the IPO raised Rs.6,560 lakh.

Financial highlights

• Gross sales were Rs.31,064.67 lakh versus Rs.24,115.52 lakh; net sales were Rs.28,917.94 lakh versus Rs.22,922.04 lakh.

• Operating profit before depreciation, interest and tax was Rs.3,081.52 lakh versus Rs.2,708.58 lakh; PBT before exceptional items was Rs.2,272.70 lakh versus Rs.2,049.90 lakh.

• Exceptional gains comprised Rs.2,970.74 lakh from land sales and Rs.600 lakh from long-term non-trade investment sales; PAT was Rs.3,742.31 lakh versus Rs.1,823.93 lakh.

• Employee costs rose to Rs.1,542.63 lakh from Rs.984.75 lakh; selling and distribution expenses fell to Rs.2,928.58 lakh from Rs.3,360.87 lakh.

Outlook and guidance

• Strategic priority: become a national player and deepen North Indian and other new-market penetration, completing IPO-funded projects on schedule.

• Domestic cable factory operations were expected by Dec. 2008; Bangalore distribution/service centre and Coimbatore pump pilot unit were targeted for June 2008 completion.

• Management expected continued demand from infrastructure, consumer durable and solar water-heater markets, supported by the expanded network and product development.