Grasim Industries Ltd. · NSE:GRASIM
Grasim Industries — Q1 FY2006 Earnings Presentation
50 slides from Grasim Industries's earnings presentation, Jul 27, 2005
Slide 1: Grasim Industries Limited Performance Review – Q1 FY06
Grasim Industries Limited Performance Review – Q1 FY06 27th July, 2005
Slide 2: Cautionary Statement
Cautionary Statement Statements in this “Presentation” describing the Company’s objectives, estimates, expectations or predictions may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or impl
Slide 3: Consolidated Financial Performance – Q1FY06
Consolidated Financial Performance – Q1FY06 z Consolidated revenue up by 8% (Rs. Crores) z PBIDT up by 10% Q1FY06 % z Tax expenses at Rs.120 Crs, lower by 38% TOTAL REVENUE 2,495 8 z PAT up by 42% ¾ Cement: PBIDT 640 10 Ö Impressive growth in volumes and profitability INTEREST CHARGES 57 (18) Ö Subs
Slide 4: Consolidated Financial Performance - Q1FY06
Consolidated Financial Performance - Q1FY06 (Rs. Crores) Q1FY06 Q1FY05* % Chg. FY05 (Restated) (Audited) Net Turnover & Op. Income 2,495.3 2,302.9 8 9410.0 Other Income 75.5 51.7 46 218.7 PBIDT 640.5 584.4 10 2,272.3 Interest 56.7 68.8 (18) 284.7 Gross Profit 583.8 515.6 13 1,987.6 Depreciation 135.
Slide 5: Consolidated Segmental Performance – Q1FY06
Consolidated Segmental Performance – Q1FY06 Revenue Mix PBIDT Mix * Others Sponge Iron Others VSF VSF 2% 11% 14% 9% 17% Sponge Iron Chemical Chemical 11% 6% 4% Textiles 2% Minority Interest 13% Cement 66% Cement 45% (Rs.2,495 Crs.) (Rs. 640 Crs.) * Including Minority Interest z VSF (incl. Chemical)
Slide 6: Standalone Financial Performance – Q1FY06
Standalone Financial Performance – Q1FY06 (Rs. Crores) z Revenue up by 2% z PBIDT lower by 1% Q1FY06 % ¾ VSF and Sponge Iron businesses TOTAL REVENUE 1,553 2 impacted z Interest cost down by 19% PBIDT 440 (1) z Total Tax expenses lower at INTEREST CHARGES 27 (19) Rs.92 Crs, decrease of 26% z Net pro
Slide 7: Standalone Financial Performance - Q1FY06
Standalone Financial Performance - Q1FY06 (Rs. Crores) Q1FY06 Q1FY05 % Chg. FY05 Net Turnover & Op. Income 1,553.3 1517.1 2 6,247.1 Other Income 65.5 16.3 303 169.4 PBIDT 439.9 446.4 (1) 1,784.7 Interest 26.5 32.9 (19) 138.8 Gross Profit 413.3 413.5 -- 1,645.9 Depreciation 70.5 69.8 1 284.6 Exceptio
Slide 8: Standalone Segmental Performance– Q1FY06
Standalone Segmental Performance– Q1FY06 Revenue Mix PBIDT Mix Others Sponge Iron VSF VSF 12% 14% 27% 21% Sponge Iron 16% Chemical Chemical 8% 6% Cement Textiles 50% 3% Cement 43% (Rs.1,553 Crs.) (Rs.440 Crs.) z VSF (incl. Chemical) contributed 33% (37%) to Revenue and 29% (36%) in PBIDT mix z Cemen
Slide 9: Business Review – Q1 FY06
Business Review – Q1 FY06 VSF Chemicals Cement Sponge Iron Textiles 9
Slide 10: Viscose Staple Fibre : Highlights
Viscose Staple Fibre : Highlights % z Satisfactory performance in a challenging Q1FY06 Q1FY05 Chg. environment Capacity (TPA) 253,675 251,850 1 z Volumes down by 13% ¾ Record Global and domestic cotton crop Production (MT) 52,282 59,712 (12) ¾ Decline in deemed exports due to Sales Volumes (MT) 52,9
Slide 11: Viscose Staple Fibre : Outlook
Viscose Staple Fibre : Outlook z Sales volumes, in the short term, to stabilise at current levels z Pressure on pricing and margins may ease ¾ Cotton prices showing early signs of recovery ¾ Input prices softening z Long term outlook remains positive ¾ Indian Textile sector to gain in post MFA era ¾
Slide 12: Chemical : Highlights and Outlook
Chemical : Highlights and Outlook % z Stellar performance Q1FY06 Q1FY05 Chg z Lower production due to CPP Caustic Capacity (TPA) 190,800 190,800 -- maintenance Caustic Production (MT) 36,017 38,318 (6) Caustic Sales Volumes (MT) 35,849 38,497 (7) z ECU realisation up 52% Net Turnover (Rs. Crs.) 99.3
Slide 13: Cement : Highlights
Cement : Highlights % z Capacity utilisation impressive at 102% Q1FY06 Q1FY05 Chg. z Sales volumes up 10% YoY Grey Cement ¾ East grew by 35% YoY on robust demand Capacity (Mn. TPA) 13.12 13.12 -- and lower base effect Production (Mn. MT) 3.35 3.00 12 Sales Volumes (Mn. MT) 3.34 3.04 10 ¾ Outperforme
Slide 14: Cement : Highlights (Contd..)
Cement : Highlights zCement : Highlights (Contd..)contd.. Q1FY06 – Growth & Market Share z White Cement 50% ¾ Volumes up 13% propelled by good 35% 40% domestic demand and exports 30% ¾ Realisations up 18% 12.9% 10.0% 20% ¾ Revenue up by 47% driven by volumes, 8.0% 9.3% 10% 7.8% 9% 6% 10% higher real
Slide 15: Cement : Outlook
Cement : Outlook z Industry prospects improving z Demand outlook positive, expected to grow by 7-8% ¾ Buoyant demand from housing segment ¾ Continued thrust on infrastructure ¾ Higher industrial growth to add further impetus z Q1FY06 grew even stronger by 11% ¾ Supported by strong recovery in the So
Slide 16: Cement Consolidated : Highlights
Cement Consolidated : Highlights Q1FY06 Q1FY05 FY05 Grey Cement SDCC Grasim 3% Capacity (Mn. TPA) 31.2 31.2 31.2 42% Production (Mn. MT) Clinker 0.46 0.86 3.1 Cement 7.23 6.46 26.1 UltraTech 55% Sales Volumes (Mn. MT) Clinker 0.46 0.86 3.1 Cement Capacity - 31.2 Mn. Ton Cement 7.20 6.44 26.3 7.65 7.
Slide 17: Sponge Iron : Highlights
Sponge Iron : Highlights % z Plant utilisation stable at 80% Q1FY06 Q1FY05 Chg. z Sales volume lower by 22% Capacity (TPA) 900,000 900,000 -- ¾ Increased import of scrap at lower prices Production (MT) 179,816 176,932 2 ¾ Slowdown in user demand on Sales Volumes (MT) 143,627 183,459 (22) expectation
Slide 18: Sponge Iron : Outlook
Sponge Iron : Outlook z Domestic demand recovery likely in 2H ¾ Steel sector outlook positive ¾ Resumption of purchases by end users ¾ Global scrap prices stabilising z Realisation under pressure reflecting effect of correction in global scrap prices z Margins to remain under pressure ¾ Substantial
Slide 19: Textiles : Highlights and Outlook
Textiles : Highlights and Outlook Q1 Q1 % z Fabric volumes down 9% FY06 FY05 Chg. Sales Volumes ¾ Lower sales from export segment - Fabrics (lac Mtrs.) 28 31 (9) z Fabric realisations up 5% on improved - Synthetic Yarn (MT) 1,643 1,559 5 sales mix Net Turnover (Rs. Crs.) 50.5 49.3 3 Fabric Realisati
Slide 20: Capex
IGRAST) Capex 20
Slide 21: Capex under implementation
Capex under implementation Rs. Crores Capex Cash Outflow plan FY06 FY07 Cement 946 479 411 - Power plants (3 Nos, 77MW) 329 114 159 - Grinding unit in North (1.3 Mn. MT) 115 65 50 - De-bottlenecking/Blending 162 58 104 - Modernization 340 242 98 VSF 533 222 311 - Capacity expansion (58,775 Tons) 374
Slide 22: Financial Highlights
Financial Highlights 22
Slide 23: Profitability Snapshot - Standalone
Profitability Snapshot - Standalone PBIDT & PBIDT Margin (Figures in Rs. Crores) FY99 FY04 FY05 Q1 1850 28.9 30 FY06 PBIDT PBIDT Margin (%) 28.7 28.4 1600 24.7 Gross Turnover 4,325 6,130 7,201 1,795 1350 PBIDT (Rs. Crs.). 25 PBIDT Margin (%) 1100 Net Turnover 3,757 5,213 6,229 1,549 1785 850 1504 PB
Slide 24: Financial Snapshot - Standalone
Financial Snapshot - Standalone Q1 Networth Cap.Employed Debt Equity Ratio (Figures in Rs. Crores) FY99 FY04 FY05 FY06 Cap.Employed/Net Worth (Rs. Crs.) 8000 1.20 6931 6995 Gross Block 4,937 5,802 6,052 6,110 7000 1.13 6304 6000 5673 Net Block 3,354 3,213 3,204 3,194 0.80 Debt Equity Ratio 5037 5000
Slide 25: Consolidated Balance Sheet
Consolidated Balance Sheet (Figures in Rs. Crores) FY04 FY05 Q1FY06 z Strong consolidated Balance Sheet as Gross Block 10,702 11,317 11,326 well Net Block 6,394 6,300 6,242 z Gearing to be viewed in the context of Goodwill 2,037 1,958 1,958 ¾ Large cash surplus Investments 270 769 1,131 ¾ Debts incl
Slide 26: UltraTech Cement Limited (Consolidated) Performance Review – Q1FY06
UltraTech Cement Limited (Consolidated) Performance Review – Q1FY06 26
Slide 27: UltraTech (Consolidated) Financial Performance - Q1FY06
UltraTech (Consolidated) Financial Performance - Q1FY06 (Rs. Crores) Q1 z Operating revenue up by 15%$$ on Q1 FY06 FY05 % Inc. FY05 higher realisation & increased Net Turnover & **858.1 697.0 **23 2,797.0 volumes Other Income PBIDT 169.1 90.1 88 379.0 z PBIDT margins increased to 20% in PBIDT Margin
Slide 28: UltraTech (Consolidated): Q1FY06 Highlights
UltraTech (Consolidated ): Q1FY06 Highlights z Capacity utilisation at 95% Q1FY06 Q1FY05 FY05 z Volumes maintained at 4 Mn. MT Capacity (Mn TPA) Clinker 15.5 15.5 15.5 ¾ Domestic volumes up by 6% Grinding 17.0 17.0 17.0 ¾ Focus on maximising cement exports, Production (Mn. MT) 130% up over correspon
Slide 29: UltraTech Outlook
UltraTech Outlook z Capex plan of Rs.1,003 Crs. including setting up of captive power plants and debottlenecking z Cost and efficiency improvement ¾ Power cost reduction ÖLignite based TPP at Gujarat plant, by July 2007 ÖCo-Generation plant at APCW ¾ Fuel cost reduction ÖBidding for captive coal and
Slide 30: Shree Digvijay Cement Company Limited (SDCC) Performance Review – Q1FY06
Shree Digvijay Cement Company Limited (SDCC) Performance Review – Q1FY06 30
Slide 31: SDCC Financial Performance - Q1FY06
SDCC Financial Performance - Q1FY06 (Rs. Crores) z Capacity utilisation at 104%(82%) Q1 Q1 % (Lac MT) z Volumes up 28% FY06 FY05 Chg. Cement Production 2.15 1.88 ¾ Increased utilisation 27 Clinker Production 0.67 0.33 ¾ Healthy demand growth in Gujarat Sales Volumes ¾ Buoyancy in clinker exports con
Slide 32: Plant Locations– Grasim & its subsidiaries
Plant Locations– Grasim & its subsidiaries Bhatinda(G) Noida Grey cement plants Gurgaon T Bhiwani Jodhpur Grinding Units (G) Shambhupura UltraTech Cement Plants Jawad Bharuch Durgapur(G) UltraTech Grinding Units (G) F Jafrabad Magdalla (G) B UltraTech Bulk Cement Terminals Sikka F C Pipavav Nagda Hi
Slide 33: Thank You
GRAS |T_M ADITYA BIRLA GROUP Thank You
Slide 34: Annexures: Segmental & Business Performance Summary
Annexures Segmental & Business Performance Summary Q1FY06 Consolidated Segmental performance Q1FY06 Segmental performance VSF Summary Chemical Summary Cement Summary Sponge Iron Summary Textiles Summary Production Data Segmental Turnover & Realisations 34
Slide 35: Consolidated Segmental Performance
Consolidated Segmental Performance Rs. Crores PBIDT Capital ROAvCE (%) Business Revenue PBIDT Margin PBIT (%) Employed# (PBIT basis) VSF 433.6 91.1 21.0 75.6 1,074.7 30.0 Chemical 101.8 37.5 36.8 33.1 204.6 64.4 Cement 1,674.0 369.5 22.1 274.0 6,735.3 16.3 Sponge Iron 220.5 69.2 31.4 60.7 478.7 49.2
Slide 36: Standalone Segmental Performance
Standalone Segmental Performance PBIDT Margin Capital ROAvCE (%) Revenue PBIDT PBIT Business (%) Employed# (PBIT basis) Q1FY06 Q1FY05 Q1FY06 Q1FY05 Q1FY06 Q1FY05 Q1FY06 Q1FY05 Q1FY06 Q1FY05 Q1FY06 Q1FY05 VSF 418.3 495.4 91.8 147.4 22.0 29.8 76.7 134.1 1,047 796 31.2 68.8 Chemical 99.5 72.5 37.5 12.0
Slide 37: Viscose Staple Fibre : Summary
Viscose Staple Fibre : Summary % Q1 FY06 Q1 FY05 FY05 Chg. Capacity TPA 253,675 251,850 1 @ 253,675 Production MT 52,282 59,712 (12) 247,952 Sales Volumes MT 52,956 60,877 (13) 231,533 Net Turnover Rs. Crs. 417.8 495.0 (16) 1,956.4 Avg. Realisation Rs./MT 73,102 77,278 (5) 79,008 PBIDT Rs. Crs. 91.8
Slide 38: Chemical : Summary
Chemical : Summary Q1FY06 Q1FY05 % Chg. FY05 Capacity (Caustic) MT 190,800 190,800 -- 190,800 Production (Caustic) MT 36,017 38,318 (6) 161,966 Sales Volume(Caustic) MT 35,849 38,497 (7) 163,111 Net Turnover Rs. Crs. 99.3 72.4 37 350.9 Avg. ECU Realisation Rs./MT 24,669 16,196 52 18,836 PBIDT Rs. Cr
Slide 39: Cement : Summary
Cement : Summary Q1FY06 Q1FY05 % Chg. FY05 Grey Cement Capacity Mn. MT 13.12 13.12 -- 13.12 Production Mn. MT 3.35 3.00 12 12.44 Sales Volumes Mn. MT 3.34 3.04 10 12.63 Net Turnover Rs. Crs. 738.1 638.5 16 2,577.8 Avg. Realisation Rs./MT 2,019 1,933 4 1,874 White Cement Capacity TPA 475,000 400,000
Slide 40: Sponge Iron : Summary
Sponge Iron : Summary Q1FY06 Q1FY05 % Chg. FY05 Capacity TPA 900,000 900,000 -- 900,000 Production MT 179,816 176,932 2 780,341 Sales Volumes MT 143,627 183,459 (22) 772,799 Net Turnover Rs. Crs. 220.5 249.9 (12) 1,021.4 Avg. Realisation Rs./MT 14,075 12,572 12 12,774 PBIDT Rs. Crs. 69.2 111.5 (38)
Slide 41: Textiles : Summary
Textiles : Summary Q1FY06 Q1FY05 % Chg. FY05 Net Turnover Rs. Crs. 50.5 49.3 3 249.9 PBIDT Rs. Crs. 0.9 2.2 (59) 11.9 PBIDT Margin % 1.8% 4.5% -- 4.8% PBIT Rs. Crs. (0.6) (1.1) (46) (0.5) Capital Employed Rs. Crs. 103 109 (5) 101 ROAvCE (PBIT basis) % (2.3)% (4.0)% -- (0.4)% 41
Slide 42: Production Data (MT)
Production Data (MT) Q1FY06 Q1FY05 FY05 Capacity Capacity Capacity Production % Production % Production % TPA TPA TPA VSF 253,675 52,282 82 251,850 59,712 95 @ 253,675 247,952 98 Caustic Soda 190,800 36,017 76 190,800 38,318 80 190,800 161,966 85 Grey Cement * 13.12 3.35 102 13.12 3.00 91 13.12 12.4
Slide 43: Divisional Turnover (Qty.) & Realisation
Divisional Turnover (Qty.) & Realisation Quantity (MT) Realisation (Rs. /MT) Product Q1FY06 Q1FY05 FY05 Q1FY06 Q1FY05 FY05 VSF 52,956 60,877 231,533 73,102 77,278 79,008 Caustic Soda * 35,849 38,497 163,111 24,669 16,196 18,836 Grey Cement * * 3.34 3.04 12.63 2,019 1,933 1,874 White Cement 79,871 70
Slide 44: Press Release Mumbai, July 27, 2005
Press Release Mumbai, July 27, 2005 GRASIM, THE ADITYA BIRLA GROUP’s FLAGSHIP COMPANY REPORTS EXCELLENT PERFORMANCE FOR Q1 FY 2006 Consolidated Net Profit up by 42% Consolidated Financial Performance Rs. Crores Q1FY06 Q1FY05 Q1FY05 % FY 2005 Restated (Audited) change *(see note) Net Revenue 2,495.3
Slide 45: Grasim’s Stand-alone Financial Performance
Grasim’s Stand-alone Financial Performance On a stand-alone basis too, notwithstanding the downturn faced by two of its major businesses, viz., Viscose Staple Fibre and Sponge Iron, the results for the quarter have been impressive. Revenues at Rs.1,553 crores were up by 2%. Net Profit was up by 15%
Slide 46: Cement Business
The Company, along with overseas group companies, is in the process of acquiring St. Anne Nackawic Pulp Mill in Canada in joint venture with Tembec, Canada, the leading integrated forest products manufacturer in North America and France. The mill is likely to recommence its operations from the 3rd q
Slide 47: Grasim Industries Limited
realizations were up by 12% over the corresponding quarter at Rs.14,075 per ton due to the scrap prices ruling high during the first two months of the quarter. Operating margins were squeezed due to a steep increase in the input costs. The outlook for the Sponge Iron Business remains positive despit
Slide 48: Unaudited Financial Results: Consolidated
UNAUDITED FINANCIAL RESULTS FOR THE QUARTER ENDED 30th JUNE 2005 CONSOLIDATED RESULTS : Rs. in Crores Three Months Three Months Full Year ended 30th ended 30th ended 31st June 2005 June 2004 March 2005 * ( Note 1 ) (Audited) Net Sales / Income from Operations 2,495.29 1,602.01 9,409.99 Other Income
Slide 49: Standalone Results
-2- STANDALONE RESULTS : Rs. in Crores Three Months Three Months Full Year ended 30th ended 30th ended 31st June 2005 June 2004 March 2005 ( Audited ) Net Sales / Income from Operations 1,553.28 1,517.08 6,247.07 Other Income 65.49 16.26 169.38 Expenditure : - Decrease / ( Increase ) in Stock (42.89
Slide 50: Segments Reporting
-3- SEGMENTS REPORTING : Rs. in Crores Standalone Consolidated Three Months Three Months Full Year Three Months Three Months Full Year ended 30th ended 30th ended 31st ended 30th ended 30th ended 31st June 2005 June 2004 March 2005 June 2005 June 2004 March 2005 ( Audited ) ( Audited ) 1. SEGMENT RE