Asian Paints Ltd. · NSE:ASIANPAINT
Asian Paints — FY2007 Earnings Presentation
35 slides from Asian Paints's earnings presentation, May 10, 2007
Slide 1: Investor Presentation FY 2007 – Annual Results
1 Investor Presentation FY 2007 – Annual Results May 10, 2007
Slide 2: Presentation structure
2 Presentation structure • Results : Q4 – FY 2007 • Results : FY 2007 • Outlook : FY 2008
Slide 3: Highlights : Q4 – FY2007
3 Highlights : Q4 – FY2007 • Consolidated Net sales and operating income increased by 25.4 % to Rs. 9,589 million – Good growth witnessed by all business units – Volume growth has been impressive for the quarter • Net Profit has risen by 43 % to Rs. 666 mn – Good performance by the Decorative Busine
Slide 4: Consolidated P&L – Q4 FY07
Consolidated P&L -— Q4 FY07 (Rs.In millions) | Q4-FY07 |04-FY'06 sales & Op. Income 650.17) 245.4% Cther Income Total Income PBDIT Interest Depreciation PBT after Goodwill PAT PAT after Min. Interest asianpaints
Slide 5: Standalone P&L – Q4 FY07
5 Standalone P&L – Q4 FY07 EOI (Extra Ordinary Item) – Provision for diminution in value of Investment.
Slide 6: Presentation structure
6 Presentation structure • Results : Q4 – FY 2007 • Results : FY 2007 • Outlook : FY 2008
Slide 7: Highlights - Consolidated results – FY2007
7 Highlights - Consolidated results –FY2007 • Paint volumes for the year including international increased by 18.7 % to 481,976 KL – All three business units registered in excess of 15% volume growth • Value Sales have grown by 21.5 % driven by – Good growth registered by Paints-India business and t
Slide 8: Consolidated P&L – FY 2007
Consolidated P&L -—FY 2007 (Rs.In millions) FY 2007 [FY 2006 _|Growth sales & Op. Income 36699.7] 3S0210.4 Cither Income af 2.5 a20.5 Total Income SfO0f2?.2] 30530.6 PBDIT 4155.5) 4257.1 Interest 1309.1 114.5 Depreciation 611.4 bOB.2 PET after Goodwill 4771.2] 345914 PAT 2004.4) 2108.5 PAT after Min
Slide 9: Consolidated Sales breakup: FY 2007 & Q4 FY 07
9 Consolidated Sales breakup : FY 2007 & Q4 FY 07 * 50 % of Asian PPG Industries sales are included
Slide 10: Asian Paints Consolidated Results FY2007
10 Asian Paints Consolidated Results FY2007 • Asian Paints Standalone Results • Decorative Business – India • Industrial Operations – India • International Operations
Slide 11: Asian Paints - Standalone P&L : FY2007
11 Asian Paints - Standalone P&L : FY2007 EOI (Extra Ordinary Item) – Provision for diminution in value of Investment.
Slide 12: Asian Paints - Standalone P&L : FY2007
12 Asian Paints - Standalone P&L : FY2007 • Net Sales grew by 21.7 % due to strong growth by all segments of the paints business • Net profit has increased by 45.7% to Rs. 2720 mn – Due to the performance of the Decorative – India business – In FY’2006 results, Rs. 336 million was provided towards d
Slide 13: Environment – FY2007
13 Environment – FY2007 • India • GDP growth at 9.0 % for FY07 – Estimated at 9.2 % for FY 08 aided by a surge in industry and services sector – Higher growth than FY07 predicted for services and industrial sector • Inflation and rising interest rates are a cause for concern • Manufacturing, Capital
Slide 14: Paint Industry – India : FY 2007
14 Paint Industry – India : FY 2007 • Paints industry estimated between Rs. 112 and Rs. 115 billion for FY2007 – Value growth is estimated at around 18% in FY2007 • Decorative paints estimated to have grown by around 19 % in value • Industrial Paints is estimated to have grown by around 17 % in valu
Slide 15: Asian Paints Consolidated Results FY2007
15 Asian Paints Consolidated Results FY2007 • Asian Paints Standalone Results • Decorative Business – India • Industrial Operations – India • International Operations
Slide 16: Paints : Decoratives India
16 Paints : Decoratives India • Demand for decorative paints was good nearly throughout the year and in most parts of the country – While Southern region of the country continues to do very well, the exceptions were Delhi and North East region • All segments for Decorative India registered double di
Slide 17: Paints : Decoratives India
17 Paints : Decoratives India • Pricing FY 2006 – Four price increases effected during the year. – Overall prince increase in the year was around 4.25% – All price increases have been absorbed well by the market • New Products – Royale Play range expanded – Luxury Ultra Gloss enamel launched in many
Slide 18: Paints : Decoratives India
18 Paints : Decoratives India • Asian Paints Home Solutions – Added 2 cities in FY2007 i.e. Jaipur and Baroda – APHS is now present in 12 cities in the country • Manufacturing facility – Ankleshwar plant has received environmental clearance for 100,000 kl from 80,000 kl
Slide 19: Paints : Decoratives India
19 Paints : Decoratives India • Price of TiO2 have been fairly stable during the year • Prices of raw materials increased sharply in 2nd and 3rd quarter in FY 2007 – Major increases were in Xylene, Phthalic Anhydride and vegetable oils • Prices of solvents have eased in Q4’FY07 due to lower crude oi
Slide 20: Asian Paints Consolidated Results FY2007
20 Asian Paints Consolidated Results FY2007 • Asian Paints Standalone Results • Decorative Business – India • Industrial Operations – India • International Operations
Slide 21: Industrial Operations
21 Industrial Operations • Sales for automotive JV (APPG) increased by 23% to Rs. 3447 million – Both OE and refinish segment performed well – Acquired the advanced refinish business of ICI India for a consideration of Rs. 520 million • APPG is now the largest player in the auto-refinish segment – W
Slide 22: Industrial Operations
22 Industrial Operations • Sales for powder coatings business (APICL) increased by 22.3 % to Rs. 477 million – Capacity expansion work underway at Baddi plant (HP) and Sarigam plant (Gujarat) • The other industrial coatings business which is part of the standalone company grew by over 20 % – The com
Slide 23: Asian Paints Consolidated Results FY2007
23 Asian Paints Consolidated Results FY2007 • Asian Paints Standalone Results • Decorative Business – India • Industrial Operations – India • International Operations
Slide 24: International Operations : FY2007
24 International Operations : FY2007 • Paint value sales increased by 20.8% to Rs. 6.24 billion – Double digit value sales growth recorded by all regions • Paint Volumes increased by 22.4 % to 94,181 KL • PBIT for International operations increased by 457 % to Rs. 192 million • Input prices were buo
Slide 25: International Operations : FY2007
25 International Operations : FY2007 • During the year, the group divested its stake in the associate company in Philippines and its stake in the Myanmar subsidiary • The profitability of international operations was impacted by the following exceptional items – Loss of Rs. 71 mn from disposal of st
Slide 26: International Operations : FY2007
26 International Operations : FY2007 • New products constituted 14 % of sales turnover • Over 600 dealer tinting systems are in operation at overseas units • Microsoft Navision – the ERP solution is running successfully in most subsidiaries • A detailed program is being implemented by all overseas u
Slide 27: Region wise Sales Breakup
27 Region wise Sales Breakup Caribb CY 2006 CY 2005 ean, Middle Caribbe 24.1% East, an, 41.2% 25.9% Middle East, 37.8% South South Pacific, Pacific, 11.5% 12.6% South S.E. S.E. South Asia, Asia, Asia, Asia, 9.8% 14.6% 13.3% 9.0%
Slide 28: Region wise – Sales & EBIT FY 2007
28 Region wise – Sales & EBIT FY 2007 In INR million
Slide 29: Asian Paints Standalone - Cash Flow FY 2007
29 Asian Paints Standalone - Cash Flow FY 2007 • Operating cash flow is higher by 43% inspite of higher tax outflow – Improvements in working capital • Capital expenditure for FY’07 was Rs 800 mn – Estimated capex for FY07 was Rs. 1500 mn • Estimated Capex for FY08 is Rs. 2750 mn
Slide 30: Dividend
30 Dividend • Final dividend of Rs. 1 /- announced for FY 2007 – First interim dividend of Rs. 5.50 / share distributed in Nov’06 – Second interim dividend of Rs. 6.50 /share distributed in Mar’07 – Total Dividend in FY 2007 is Rs. 13 /- • Total Dividend of 125%(Rs. 12.5 per share ) distributed for
Slide 31: Key Ratios
Key Ratios Standalone 31 Consolidated FY #007 FY2006 FY 4007 FY2006 iat Cost/Net Sales 5.5 PBDIT * Met Sales 16.4% PBTiw'o EOI Met Sales 14.6% PATiwio EOW / Met Sales 96% Sido a 16.7% 14.7% Goo athe a abe a 14.0% 14.0% 11.6% 11.4% fo? Fo * 0% asianpaints
Slide 32: Presentation structure
32 Presentation structure • Results : Q4 – FY 2007 • Results : FY 2007 • Outlook : FY 2008
Slide 33: Outlook – FY2008
33 Outlook– FY2008 • India • Paint Industry expected to grow by 13 – 15 % by value • Inflation and rising interest rates are a cause for concern • In Decorative paints our emphasis would continue to be to drive top-line growth • Demand for industrial coatings will continue to be buoyant
Slide 34: Outlook – FY2008
34 Outlook– FY2008 • International • The focus for international business is to grow top-line and improve profitability – The Caribbean, Middle East, South Asia and South Pacific regions are expected to register an improved performance – Steps have been taken to reduce losses in the South East Asia
Slide 35: Thank you...
Thank you... asianpaints