V2 Retail (V2RETAIL) Q4 05/06 earnings summary

Executive summary

• FY06 sales reached Rs 2,884.43m and profit after tax Rs 123.87m, up from Rs 30.07m in FY05; reported turnover including other income increased 97% on an annualized basis.

• Operations spanned 26 stores in 20 cities across 12 states; plans called for 30+ additional stores and an IPO in FY07.

Financial highlights

• Sales were Rs 2,884.43m versus Rs 1,463.12m; other income was Rs 6.46m versus Rs 1.43m.

• Profit before tax was Rs 186.17m versus Rs 49.71m; profit after tax was Rs 123.87m versus Rs 30.07m.

• Total expenses rose to Rs 2,704.71m from Rs 1,414.83m; cost of goods sold was Rs 1,736.92m versus Rs 894.02m.

• Rent expense was Rs 144.24m versus Rs 85.45m; sales tax expense was Rs 138.87m versus Rs 35.40m.

Outlook and guidance

• Plans targeted 30+ new stores and an IPO in FY07; the BCCL agreement required an IPO by March 31, 2007.

• Directors retained earnings to fund growth initiatives and declared no dividend for FY06.