West Coast Paper Mills (500444) Q4 96/97 earnings summary

Executive summary

• FY97 paper and paper-board production rose to 91,715 MT from 88,255 MT; net profit fell to Rs 878.87 lacs from Rs 2,994.47 lacs.

• Despite higher paper and board sales volumes, margins faced pressure from weak demand and rising input costs; Duplex Board production began after commissioning in September 1996.

Financial highlights

• Sales were Rs 28,207.46 lacs versus Rs 26,973.38 lacs; total income was Rs 28,753.15 lacs versus Rs 27,248.07 lacs.

• Gross profit declined to Rs 1,806.87 lacs from Rs 3,466.32 lacs; profit before tax was Rs 1,013.87 lacs versus Rs 3,179.47 lacs.

• Net profit was Rs 878.87 lacs versus Rs 2,994.47 lacs; depreciation rose to Rs 792.996 lacs from Rs 286.85 lacs and interest and financing charges to Rs 1,217.69 lacs from Rs 514.97 lacs.

• Paper and board sales, including excise duty, were Rs 272.05 crore versus Rs 264.33 crore; total paper and Duplex Board sales volume was 90,670 MT versus 86,087 MT.

Outlook and guidance

• First four months' paper and board production was 30,356 MT versus 29,985 MT, a reported 4% increase; Duplex Board output was 3,937 MT.

• Duplex Board production and quality had stabilised; further production improvement was expected in the coming months.

• The 250 TPD bleach plant was expected to begin trial runs by end-December 1997; the new digester was targeted for commissioning by March 1998.

• Planned projects had an estimated investment outlay of Rs 200 crore, with financing tie-up yet to be finalised.