West Coast Paper Mills (500444) Q4 03/04 earnings summary

Executive summary

• FY04 results were pressured by higher raw-material, wage and maintenance costs and a 45-day shutdown of Paper Machine I; higher production and completed expansion projects partly cushioned the impact.

• Paper output rose 8% to 163,714 MT, while gross profit eased to Rs 60.57 crore from Rs 62.24 crore; standalone net profit before the reserve write-back fell 21% to Rs 28.44 crore.

Financial highlights

• Standalone total income was Rs 5,823,615,383 vs Rs 5,224,447,738; profit before tax was Rs 436,855,381 vs Rs 440,125,389.

• Standalone profit after tax was Rs 284,416,562 vs Rs 360,418,461; a Rs 38,989,631 Investment Fluctuation Reserve write-back brought net profit for the year to Rs 323,406,193.

• Consolidated total income was Rs 6,257,494,446 vs Rs 5,681,081,978; consolidated profit after tax was Rs 276,254,992 vs Rs 365,258,769.

• Paper and board sales, inclusive of excise duty, increased 9% to Rs 476.57 crore; export volume rose to 10,595 MT from 8,555 MT.

Outlook and guidance

• First two months of FY05 paper, paperboard and duplex-board production reached 28,828 MT vs 26,282 MT; output was expected to improve with the rebuilt Paper Machine I.

• First-quarter paper and paperboard selling prices rose, but continued input-cost inflation, raw-material scarcity and higher coal prices could adversely affect results.

• International pulp prices were trending upward, expected to support paper realizations; India’s paper demand was cited as growing 5.6% annually.