Grasim Industries Ltd. · NSE:GRASIM

Grasim Industries — Q3 FY2006 Earnings Presentation

56 slides from Grasim Industries's earnings presentation, Jan 25, 2006

  1. Slide 1: Performance Review – Q3 FY06

    Grasim Industries Limited Performance Review – Q3 FY06 25th January 2006

  2. 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

  3. Slide 3: Consolidated Financial Performance – Q3FY06

    Consolidated Financial Performance – Q3FY06 % z Consolidated revenue up by 7% Rs. Crs. Change z PBIDT lower by 2% ¾ Excellent performance from Grasim’s TOTAL REVENUE 2,503 7 Cement Business ¾ UltraTech performed better PBIDT 505 (2) ¾ Encouraging Performance by VSF business Interest Charges 53 [27]

  4. Slide 4: Consolidated Financial Performance – 9MFY06

    Consolidated Financial Performance – 9MFY06 % z Consolidated revenue up by 7% Rs. Crs. Change z PAT up by 10% TOTAL REVENUE 7,299 7 ¾ Excellent performance from Grasim’s Cement Business and Chemical Business PBT 1,027 2 ¾ Better performance from UTCL ¾ Subdued performance by VSF business Total Tax E

  5. Slide 5: Consolidated Financial Performance

    Consolidated Financial Performance (Rs. Crores) Q3FY06 Q3FY05 % Chg. 9MFY06 9MFY05 % Chg. FY05 (Audited) Net Turnover & Op. Income 2,503.2 2,338.6 7 7,298.9 6,840.1 7 9,317.3 Other Income 29.6 43.8 (32) 149.8 133.3 12 217.6 PBIDT 504.6 512.7 (2) 1,606.0 1,635.2 (2) 2,272.3 Interest 53.1 72.9 (27) 16

  6. Slide 6: Consolidated Segmental Performance – Q3FY06

    Consolidated Segmental Performance – Q3FY06 Revenue Mix PBIDT Mix Sponge Iron Others VSF VSF 5% 2% Others 25% 21% 5% Sponge Iron 1% Chemical Chemical 5% * 4% Textiles 2% Cement 66% Cement 64% (Rs.2,503 Crs.) (Rs.505 Crs.) z VSF (incl. Chemical) contributed 25% to Revenue and 30% in PBIDT mix z Cemen

  7. Slide 7: Standalone Financial Performance – Q3FY06

    Standalone Financial Performance – Q3FY06 % z Revenue up by 6% Rs. Crs. Change z PBIDT down by 22% TOTAL REVENUE 1,648 6 ¾ Cement PBIDT soar by 61% ¾ Encouraging performance by VSF business PBIDT 334 (22) ¾ Sponge Iron business continues to suffer z Interest cost down by 33% Interest Charges 23 [33]

  8. Slide 8: Standalone Financial Performance – 9MFY06

    Standalone Financial Performance – 9MFY06 % z Revenue up by 5% Rs. Crs. Change z PBIDT down by 14% TOTAL REVENUE 4,841 5 ¾ Cement PBIDT up by 31% ¾ Excellent performance by Chemical business PBIDT 1,127 (14) ¾ Subdued performance by VSF business, particularly in Q1 Interest Charges 74 [30] ¾ Poor pe

  9. Slide 9: Standalone Financial Performance

    Standalone Financial Performance (Rs. Crores) Q3FY06 Q3FY05 % Chg. 9MFY06 9MFY05 % Chg. FY05 Net Turnover & Op. Income 1,648.2 1,559.7 6 4,840.6 4,610.3 5 6,252.4 Other Income 15.3 37.9 (60) 111.6 84.6 32 167.0 PBIDT 334.3 430.5 (22) 1,126.8 1,306.6 (14) 1,784.7 Interest 23.5 35.2 (33) 73.7 104.8 (3

  10. Slide 10: Standalone Segmental Performance – Q3FY06

    Standalone Segmental Performance– Q3FY06 Revenue Mix PBIDT Mix Sponge Others Sponge Iron Iron 2% 8% VSF 1% 31% VSF 37% Chemical Cement 5% Cement 53% Textiles 52% Chemical 3% 8% (Rs.1,648 Crs.) (Rs.334 Crs.) z VSF (incl. Chemical) contributed 36% (37%) to Revenue and 45% (45%) in PBIDT mix z Cement c

  11. Slide 11: Business Review – Q3 FY06

    Business Review – Q3 FY06 ƒ VSF ƒ Chemicals ƒ Cement ƒ Sponge Iron ƒ Textiles 11

  12. Slide 12: Viscose Staple Fibre: Highlights

    Viscose Staple Fibre : Highlights % z Capacity utilisation at 96% on enhanced Q3FY06 Q3FY05 Chg. Capacity (TPA) 257,325 251,850 2 capacity Production (MT) 61,862 63,558 (3) z Production marginally lower by 3% due to Sales Volumes (MT) 66,025 55,956 18 Net Turnover (Rs Crs.) 515.2 489.7 5 labour unre

  13. Slide 13: Viscose Staple Fibre: Outlook

    Viscose Staple Fibre : Outlook z Volumes prospects remain positive ¾ Strong demand from South Asian countries ¾ Domestic demand remains firm z Price outlook stable ¾ Selling price raised by Re.1/kg. consecutively for second quarter ¾ Cotton prices showing signs of recovery z Long term outlook remain

  14. Slide 14: Chemical: Highlights and Outlook

    Chemical : Highlights and Outlook % z Capacity utilisation at 92% Q3FY06 Q3FY05 Chg z Sales volume grew by 3% backed by Caustic Capacity (TPA) 190,800 190,800 -- Caustic Production (MT) 44,039 42,719 3 growth in end use segment Caustic Sales Volumes (MT) 44,283 43,170 3 z ECU realisation down by 3%

  15. Slide 15: Cement: Highlights

    Cement : Highlights % z Excellent performance Q3FY06 Q3FY05 Chg. z Capacity utilisation impressive at 106% Grey Cement Capacity (Mn. TPA) 13.12 13.12 -- z Robust growth in volumes Production (Mn. MT) 3.49 3.11 12 ¾ Up 11% YoY against sector average growth Sales Volumes (Mn. MT) * 3.53 3.19 11 of 9%

  16. Slide 16: Cement: Highlights (Contd.)

    Cement : Highlights zCement : Highlights (Contd..)contd.. Q3FY06 – Zone wise Growth z Significant improvement in margins from 13.9% 13.1% 16% to 22% 10.6% 10.3% 10.3% 15% 9.2% 9.2% 7.8% ¾ Increased realisations 5.9% 5% ¾ Lower fuel cost due to optimum fuel mix -0.6% z Operating profit surged by 61%

  17. Slide 17: Cement Consolidated: Highlights

    Cement Consolidated : Highlights Q3FY06 Q3FY05 FY05 Cement SDCC Grasim 3% Capacity (Mn. TPA) 31.2 31.2 31.2 42% Production (Mn. MT) Clinker 0.4 0.9 3.1 Cement 7.0 6.7 26.1 UltraTech 55% 7.4 7.6 29.2 Sales Volumes (Mn. MT) Cement Capacity - 31.2 Mn. Ton Clinker 0.4 0.9 3.1 Cement 7.1 6.8 26.3 7.5 7.7

  18. Slide 18: Cement: Outlook

    Cement : Outlook z Demand continues to grow in line with expectations ¾ Sector growth of 10% in 9MFY06 ¾ Impressive growth in South (up 17%) and East (up 14%) z Demand outlook positive, expected to grow by 8-9% in the long term ¾ Growing demand from housing and infrastructure ¾ Industrial investment

  19. Slide 19: Sponge Iron: Highlights

    Sponge Iron : Highlights z Production impacted as plant being % operated at minimum load Q3FY06 Q3FY05 Chg. ¾ Use of alternate fuel minimised; Capacity (TPA) 900,000 900,000 -- uneconomical at current realisation level Production (MT) 90,972 180,687 (50) ¾ Annual maintenance shutdown undertaken in t

  20. Slide 20: Sponge Iron: Outlook

    Sponge Iron : Outlook z Capacity utilisation likely to remain low z Steel sector outlook subdued z Profitability to remain under pressure in ensuing quarters ¾ Lower volumes due to poor gas supply ¾ Input cost to remain at higher levels ¾ Depressed market conditions z Business prospects expected to

  21. Slide 21: Textiles: Highlights and Outlook

    Textiles : Highlights and Outlook Q3 Q3 % z Fabric volumes lower by 28% FY06 FY05 Chg. Sales Volumes ¾ Reduced exports due to lower - Fabrics (lac Mtrs.) 26 36 (28) realisations - Synthetic Yarn (MT) 1,665 1,277 30 z Fabric realisations up 5% Net Turnover (Rs. Crs.) 50.9 59.3 (14) Fabric Realisation

  22. Slide 22: Capex

    Capex 22

  23. Slide 23: Capex under implementation

    Capex under implementation Rs. Crores Capex Cash Outflow plan FY06 FY07 Cement 951 322 570 - Power plants (3 Nos, 77MW) 330 74 200 - Grinding unit in North (1.3 Mn. MT) 115 20 95 - De-bottlenecking/Blending 144 30 114 - Modernization 362 198 161 VSF 533 147 320 - Capacity expansion (49,625 Tons) 374

  24. Slide 24: Financial Highlights

    Financial Highlights 24

  25. Slide 25: Profitability Snapshot - Standalone

    Profitability Snapshot - Standalone 9M z EPS improved significantly from Rs.13* in (Figures in Rs. Crores) FY99 FY04 FY05 FY06 FY99 to Rs.97 in FY05 Gross Turnover 4,325 6,130 7,201 5,552 z Over 8 times growth in market cap. Net Turnover 3,757 5,213 6,229 4,812 Rs.128 Bn. (US$ 2.8 Bn.) PBIDT 674 1,5

  26. Slide 26: Financial Snapshot - Standalone

    Financial Snapshot - Standalone Networth Cap.Employed Debt Equity Ratio (Figures in Rs. Crores) FY99 FY04 FY05 Cap.Employed/Net Worth (Rs. Crs.) 8000 7458 1.20 6931 7000 1.13 Gross Block 4,937 5,802 6,052 6304 6000 5673 Debt Equity Ratio 0.80 5037 4924 Net Block 3,354 3,213 3,204 5000 4324 0.70 0.46

  27. Slide 27: Consolidated Balance Sheet

    Consolidated Balance Sheet (Figures in Rs. Crores) FY04 FY05 z Strong consolidated Balance Sheet as well Gross Block 10,702 11,317 z Leveraging in real term even lower, to be Net Block 6,394 6,300 viewed in the context of Goodwill 2,037 1,958 ¾ Cash surplus Investments 270 769 ¾ Debts include long t

  28. Slide 28: UltraTech Cement Limited (Consolidated) Performance Review – Q3FY06

    UltraTech Cement Limited (Consolidated) Performance Review – Q3FY06 28

  29. Slide 29: UltraTech (Consolidated) Financial Performance-Q3FY06

    UltraTech (Consolidated) Financial Performance-Q3FY06 (Rs. Crores) z *Turnover higher by 8% Q3 Q3 % FY05 FY06 FY05 Inc. z Operating Margins increased from 9.8% Net Turnover & * 734.8 680.3 8 2,700.3 to 18.3% Other Income PBIDT 133.3 ^ 65.9 102 378.9 ¾ Improved realisation PBIDT Margin (%) 18.3% 9.8%

  30. Slide 30: UltraTech Consolidated: Q3FY06 Highlights

    UltraTech Consolidated: Q3FY06 Highlights z Effective capacity utilisation at 88% in Q3FY06 Q3FY05 FY05 Capacity (Mn TPA) Q3FY06 against 99% in Q3FY05 Clinker 15.50 15.50 15.50 ¾ Lower despatches from APCW due to Grinding 17.00 17.00 17.00 disruption in packing plant Production (Mn. MT) Clinker 0.40

  31. Slide 31: UltraTech Outlook

    UltraTech Outlook z Capex plan of Rs.987 Crs. (including captive power plant of Rs.540 Crs.) z Cost and efficiency improvement ¾ Power cost reduction ÖLignite based TPP at Gujarat plant, by Jan 2008 ÖCo-Generation plant at APCW ¾ Fuel cost reduction ÖBidding for captive coal and lignite mines ÖUse o

  32. Slide 32: Shree Digvijay Cement Company Limited (SDCC) Performance Review – Q3FY06

    Shree Digvijay Cement Company Limited (SDCC) Performance Review – Q3FY06 32

  33. Slide 33: SDCC Financial Performance - Q3FY06

    SDCC Financial Performance - Q3FY06 (Rs. Crores) z Capacity utilisation at 90% Q3 Q3 % (Lac MT) FY06 FY05 Chg. z Cement sales volumes up 5% Cement Production 2.42 2.28 (19) z Cement realisations surged by 56% Clinker Production -- 0.71 ¾ Better pricing environment in Gujarat Sales Volumes z Higher o

  34. Slide 34: 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

  35. Slide 35: Thank You

    GRAS TM ADITYA BIRLA GROUP Thank You

  36. Slide 36: Annexures

    Annexures Segmental & Business Performance Summary (Q3/9M FY06) ƒ Consolidated Performance ƒ Standalone Performance ƒ Segmental Performance ƒ VSF Summary ƒ Chemical Summary ƒ Cement Summary ƒ Sponge Iron Summary ƒ Textiles Summary ƒ Production Data ƒ Turnover & Realisations ƒ UltraTech Performance ƒ

  37. Slide 37: Consolidated Financial Performance

    Consolidated Financial Performance (Rs. Crores) Q3FY06 Q3FY05 % Chg. 9MFY06 9MFY05 % Chg. FY05 (Audited) Net Turnover & Op. Income 2,503.2 2,338.6 7 7,298.9 6,840.1 7 9,317.3 Other Income 29.6 43.8 (32) 149.8 133.3 12 217.6 PBIDT 504.6 512.7 (2) 1,606.0 1,635.2 (2) 2,272.3 Interest 53.1 72.9 (27) 16

  38. Slide 38: Standalone Financial Performance

    Standalone Financial Performance (Rs. Crores) Q3FY06 Q3FY05 % Chg. 9MFY06 9MFY05 % Chg. FY05 Net Turnover & Op. Income 1,648.2 1,559.7 6 4,840.6 4,610.3 5 6,252.4 Other Income 15.3 37.9 (60) 111.6 84.6 32 167.0 PBIDT 334.3 430.5 (22) 1,126.8 1,306.6 (14) 1,784.7 Interest 23.5 35.2 (33) 73.7 104.8 (3

  39. Slide 39: Segmental Performance-Q3FY06

    Segmental Performance-Q3FY06 Standalone (Rs. Crores) PBIDT Margin Capital ROAvCE (%) Revenue PBIDT PBIT Business (%) Employed (PBIT basis) Q3FY06 Q3FY05 Q3FY06 Q3FY05 Q3FY06 Q3FY05 Q3FY06 Q3FY05 Q3FY06 Q3FY05 Q3FY06 Q3FY05 VSF 515.8 489.6 124.2 160.7 24.1 32.8 107.6 146.0 903 963 47.9 67.9 Chemical

  40. Slide 40: Segmental Performance-9MFY06

    Segmental Performance-9MFY06 Standalone (Rs. Crores) PBIDT Margin Capital ROAvCE (%) Revenue PBIDT PBIT Business (%) Employed (PBIT basis) 9MFY06 9MFY05 9MFY06 9MFY05 9MFY06 9MFY05 9MFY06 9MFY05 9MFY06 9MFY05 9MFY06 9MFY05 VSF 1,433.9 1,500.8 339.3 486.8 23.9 32.6 291.6 444.5 903 963 43.3 68.9 Chemi

  41. Slide 41: Viscose Staple Fibre: Summary

    Viscose Staple Fibre : Summary Q3 % 9M 9M % Q3 FY06 FY05 FY05 Chg. FY06 FY05 Chg. Capacity TPA # 257,325 251,850 2 257,325 251,850 2 @ 253,675 Production MT 61,862 63,558 (3) 164,376 184,648 (11) 247,952 Sales Volumes MT 66,025 55,957 18 181,757 177,350 2 231,533 Net Turnover Rs. Crs. 515.2 489.7 5

  42. Slide 42: Chemical: Summary

    Chemical : Summary Q3 Q3 % 9M 9M % FY05 FY06 FY05 Chg. FY06 FY05 Chg. Capacity (Caustic) MT 190,800 190,800 -- 190,800 190,800 -- 190,800 Production (Caustic) MT 44,039 42,719 3 122,822 119,802 3 161,966 Sales Volume(Caustic) MT 44,283 43,170 3 121,717 120,318 1 163,111 Net Turnover Rs. Crs. 93.0 94

  43. Slide 43: Cement: Summary

    Cement : Summary Q3 Q3 % 9M 9M % FY05 Chg. FY05 FY05 FY06 FY06 Chg. Grey Cement Capacity Mn. MT 13.12 13.12 -- 13.12 13.12 -- 13.12 Production Mn. MT 3.49 3.11 12 10.05 9.14 10 12.44 Sales Volumes Mn. MT * 3.53 3.19 11 * 10.12 9.27 9 12.63 Net Turnover Rs. Crs. * @730.6 623.8 17 * @2,111.1 1,878.4 1

  44. Slide 44: Sponge Iron: Summary

    Sponge Iron : Summary Q3 Q3 % 9M 9M % FY05 FY06 FY05 Chg. FY06 FY05 Chg. Capacity TPA 900,000 900,000 -- 900,000 900,000 -- 900,000 Production MT 90,972 180,687 (50) 396,732 560,595 (29) 780,341 Sales Volumes MT 98,440 196,735 (50) 382,342 570,154 (33) 772,799 Net Turnover Rs. Crs. 132.9 262.7 (49)

  45. Slide 45: Textiles: Summary

    Textiles : Summary Q3 Q3 % 9M 9M % FY05 FY06 FY05 Chg. FY06 FY05 Chg. Net Turnover Rs. Crs. 50.9 59.3 (14) 172.1 184.0 (6) 249.9 PBIDT Rs. Crs. 0.2 1.6 (87) 4.5 8.8 (49) 11.9 PBIDT Margin % 0.4% 2.7% -- 2.6% 4.8% -- 4.8% PBIT Rs. Crs. (1.3) (1.6) -- 0.1 (0.9) -- (0.5) Capital Employed Rs. Crs. 100 1

  46. Slide 46: Production Data (MT)

    Production Data (MT) Q3FY06 Q3FY05 FY05 Capacity Capacity Capacity Production % Production % Production % TPA TPA TPA VSF # 257,325 61,862 96 251,850 63,558 101 @ 253,675 247,952 98 Caustic Soda 190,800 44,039 92 190,800 42,719 90 190,800 161,966 85 Grey Cement * 13.12 3.49 106 13.12 3.11 95 13.12 1

  47. Slide 47: Divisional Turnover (Qty.) & Realisation

    Divisional Turnover (Qty.) & Realisation Quantity (MT) Realisation (Rs. /MT) Product Q3FY06 Q3FY05 FY05 Q3FY06 Q3FY05 FY05 VSF 66,025 55,956 231,533 72,816 81,066 79,008 Caustic Soda * 44,283 43,170 163,111 18,846 19,472 18,836 Grey Cement * * 3.53 3.19 12.63 1,908 1,775 1,874 White Cement 90,474 86

  48. Slide 48: UltraTech (Consolidated): Financial Performance

    UltraTech (Consolidated): Financial Performance (Rs. Crores) Q3 Q3 % Inc. 9M 9M % Inc. FY05 FY06 FY05 FY06 FY05 Net Turnover & Other * 734.8 680.3 8 * 2,090.3 1,959.3 7 2,700.3 Income PBIDT 133.3 65.9 102 380.8 246.6 54 378.9 PBIDT Margin (%) 18.3% 9.8% -- 18.4% 12.7% -- 14.1% Interest 23.0 26.9 (14

  49. Slide 49: SDCC: Financial Performance

    SDCC : Financial Performance (Rs. Crores) % 9M 9M % Q3 FY06 Q3 FY05 FY05 Chg. FY06 FY05 Chg. Net Turnover & Op. Income 51.6 41.2 25 149.6 121.5 23 168.9 Other Income 0.5 0.6 (5) 3.3 4.1 (20) 5.5 PBIDT 8.3 (3.0) -- 30.1 8.2 266 18.1 PBIDT Margin 16.2% -- -- 20.1% 6.8% -- 10.7% Interest * 0.4 4.6 -- *

  50. Slide 50: Press Release: Results for Q3 FY 2006

    Press Release Mumbai, January 25, 2006 GRASIM, THE ADITYA BIRLA GROUP’s FLAGSHIP COMPANY RESULTS FOR Q3 FY 2006 Consolidated Financial Performance: Rs. Crores Q3 Q3 % 9 Months 9 Months % FY06 FY05 Change FY06 FY05 Change Net Revenue 2,503.2 2,338.6 7.0 7,298.9 6,840.1 6.7 Gross Profit 451.5 439.8 2.

  51. Slide 51: Highlights of Grasim's operations

    Highlights of Grasim’s operations: Q3FY06 Q3FY05 % Change FY 2005 Production - Viscose Staple Fibre M.T. 61,862 63,558 -3% 2,47,952 Cement Mn. M.T. 3.49 3.11 12% 12.44 White Cement M.T. 87,377 87,638 - 3,15,368 Sponge Iron M.T. 90,972 1,80,687 -50% 7,80,341 Caustic Soda M.T. 44,039 42,719 3% 1,61,96

  52. Slide 52: Cement Business, Sponge Iron Business, Chemical Business

    Cement Business Grasim’s Cement Business has posted an excellent performance during the quarter. Capacity utilisation was higher at 106% as compared to 95% in the corresponding quarter. Sales volumes were up by 11% at 3.53 Mn. tons. Realizations too were higher by 7% at Rs.1,908 per ton. The Company

  53. Slide 53: Outlook

    Outlook Grasim is poised for a significant growth in the years ahead. The optimism stems from the Company’s expanded capacities, leadership status in its key business segments, cost optimization measures, strategic planning and prudent financial management. Grasim Industries Limited Regd. Office: Bi

  54. Slide 54: Unaudited Financial Results for the Quarter Ended December 2005

    UNAUDITED FINANCIAL RESULTS st FOR THE QUARTER ENDED 31 DECEMBER 2005 I. CONSOLIDATED RESULTS : Rs in Crores Three Months Three Months Nine Months Nine Months Full Year ended 31st ended 31st ended 31st ended 31st ended 31st Deceember 2005 Deceember 2004 Deceember 2005 Deceember 2004 March 2005 ( Aud

  55. Slide 55: Segment Reporting - Consolidated

    -2- III. SEGMENT REPORTING - CONSOLIDATED Rs. in Crores Three Months Three Months Nine Months Nine Months Full Year ended 31st ended 31st ended 31st ended 31st ended 31st December 2005 December 2004 December 2005 December 2004 March 2005 ( Audited ) 1. SEGMENT REVENUE a Fibre & Pulp 529.63 502.53 1,

  56. Slide 56: Notes

    -3- V. NOTES 1 Consolidated Results have been prepared in accordance with Accounting Standard on Consolidated Financial Statements (AS-21) and Accounting Standard on Financial Reporting of Interest in Joint Ventures (AS-27) issued by the Institute of Chartered Accountants of India. 2 The workers of

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