Asian Paints Ltd. · NSE:ASIANPAINT
Asian Paints — FY2008 Earnings Presentation
33 slides from Asian Paints's earnings presentation, May 9, 2008
Slide 1: Investor Presentation FY 2008 – Annual Results
1 Investor Presentation FY 2008 – Annual Results May 9, 2008
Slide 2: Presentation structure
2 Presentation structure • Results : Q4 – FY 2008 • Results : FY 2008 • Outlook : FY 2009
Slide 3: Highlights: Q4 – FY2008
3 Highlights : Q4 – FY2008 • Consolidated Net sales and operating income increased by 18.2% to Rs. 1133 crores • Net Profit has risen by 41.9 % to Rs. 95 crores – Good performance by all business units • Operating margins have improved due to lower material cost vis-à-vis last year
Slide 4: Consolidated P&L – Q4 FY08
Consolidated P&L — Q4 FY08 (Rs. In crores) 04 07-08 Q4 06-07 Sales & Op Income Other Income Total Income PBDIT Interest Depreciation PBT PAT PAT after Minority interest 1,133 13 1,146 169 4 15 150 102 95 959 i4 973 131 4 17 101 61 67 18.2% -1.99%6 17.9% 29.5% -8.3% -10.8% 48.1% 66.79% 41.9% asianpai
Slide 5: Standalone P&L – Q4 FY08
Standalone P&L — Q4 FY08 (Rs. In crores) 4 07-08| O4 06-07] Gr % Sales & Op Income 869 427 19.5% Other Income 11 13) -15.496 Total Income 880 740 18.890 PBDIT 144 120| 19.9% Interest 1 2} -15.7%6 Depreciation 11 12 -3,.0%6 PBT 131 106| 23.0% PAT 85 71 19.29% asianpaints
Slide 6: Presentation structure
6 Presentation structure • Results : Q4 – FY 2008 • Results : FY 2008 • Outlook : FY 2009
Slide 7: Highlights - Consolidated results – FY2008
7 Highlights - Consolidated results –FY2008 • Paint volumes for the year (including international) increased by 18.7% to 571,911 KL • Value Sales have grown by 20.0 % driven by – Good growth registered by Paints-India business and the Middle East region • Material costs as a percentage to sales has
Slide 8: Consolidated P&L – FY 2008
Consolidated P&L -—FY 2008 (Rs. In crores) 12M 07-08] 12M 06-07! Gr % Sales & Op Income 4,404 3,670) 20.096 Other Income 62 37| 66.3% Total Income 4,466 3,707) 20.5% PBDIT 720 515] 39.9% Interest 21 19} 11.996 Depreciation 59 61] -3.2% PBT 633 427) 48.29% PAT 430 280] 53.2% PAT after Minority intere
Slide 9: Consolidated Sales breakup: FY 2008
9 Consolidated Sales breakup : FY 2008 * 50 % of Asian PPG Industries sales are included
Slide 10: Asian Paints Consolidated Results FY2008
10 Asian Paints Consolidated Results FY2008 • Asian Paints Standalone Results • Decorative Business – India • Industrial Operations – India • International Operations
Slide 11: Asian Paints - Standalone P&L : FY2008
11 Asian Paints - Standalone P&L : FY2008
Slide 12: Asian Paints - Standalone P&L : FY2008
12 Asian Paints - Standalone P&L : FY2008 • Net Sales grew by 21.1% while paint volumes grew by 17.5% • Strong growth in all segments of the paints business • Net profit has increased by 37.9% to Rs. 375 Crs • Chemicals business registered revenue growth of 12.5 % to Rs.104 Crs. (adjusting for inter
Slide 13: Environment – FY2008
13 Environment – FY2008 • India • GDP growth at 8.7 % for FY08 – Driven by 2.6% growth in agriculture, 8.6% in manufacturing and 10.6% in services • Crude oil prices reached unprecedented levels • The sub-prime crisis impacted liquidity, major banking institutions, and the stock markets • Inflation
Slide 14: Paint Industry – India : FY 2008
14 Paint Industry – India : FY 2008 • Paints industry estimated around Rs. 13,500 crores for FY’2008 – Value growth is estimated at around 19% and volume growth of around 15% in FY2008 • Decorative paints estimated to be over 75% of the overall market, estimated to have grown around 19 % in value •
Slide 15: Asian Paints Consolidated Results FY2008
15 Asian Paints Consolidated Results FY2008 • 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 throughout the year and in most parts of the country – Diwali was good all over Northern and Western India – Robust growth continued after Diwali as well • Interior and Exterior Emulsions continued their impressive growth • Prices
Slide 17: Paints : Decoratives India
17 Paints : Decoratives India • Weighted average price changes in FY 2008 – Decrease of around 1 % in Aug’07. Primarily in water based products – Decrease of 0.80 % in Dec’07. Primarily in water based products – Increase of around 1.2 % in Feb’08. Primarily in solvent products – All price increases
Slide 18: Paints : Decoratives India
18 Paints : Decoratives India • Asian Paints Home Solutions – Added Chandigarh during the year – APHS is now present in 13 cities in the country • Manufacturing facilities – Polymer plant in Sriperumbudur commissioned in Q1 of 2007-08 – Further expansion of the Sriperumbudur plant will increase its
Slide 19: Paints : Decoratives India
19 Paints : Decoratives India • Rutile & solvent prices were lower than last year • Solvent and oil prices increased sharply in the last quarter • Overall prices are in line with last year inspite of increase in oil prices
Slide 20: Asian Paints Consolidated Results FY2008
20 Asian Paints Consolidated Results FY2008 • 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 31.9% to Rs. 392 crs – The advanced refinish business acquired from ICI India, successfully integrated – APPG will be receiving Rs 20.8 Cr from ICI India over a period of 19 months from Jan ‘08 to July ’09 due to the “change in c
Slide 22: Industrial Operations
22 Industrial Operations • Sales for powder coatings business (APICL) increased by 23.1 % to Rs. 58.7 crs – Installed new production lines at Sarigam plant (Gujarat) • The other industrial coatings business which is part of the standalone company also achieved significant growth – Good business gene
Slide 23: Asian Paints Consolidated Results FY2008
23 Asian Paints Consolidated Results FY2008 • Asian Paints Standalone Results • Decorative Business – India • Industrial Operations – India • International Operations
Slide 24: International Operations : FY2008
24 International Operations : FY2008 • Paint Volumes increased by 23.4 % to 116,200 KL • Paint value sales increased by 12% to Rs. 699 crores – Adjusted for the exchange rate impact, paint value sales has grown by 18.1% • PAT (before EOI and minority interest) for International operations increased
Slide 25: International Operations : FY2008
25 International Operations : FY2008 • During the year, the group divested its stake in Asian Paints (Queesland) Ltd., Australia • The profitability of international operations was impacted by the following exceptional items – Loss of Rs 7 Cr arising from the disposal of the group’s stake in its sub
Slide 26: Region wise Sales Breakup
26 Region wise Sales Breakup CY 2007 Caribb CY 2006 Caribb Middle ean, Middle ean, East, 24.1% East, 21.4% 45.4% 41.2% South South Pacific, Pacific, 8.8% 11.5% S.E. South South S.E. Asia, Asia, Asia, Asia, 12.6% 11.8% 9.8% 13.3%
Slide 27: Region wise – Sales & EBIT
27 Region wise – Sales & EBIT In INR Crores Value Sales CY 2007 CY 2006 Growth Caribbean 150 152 -1% Middle East 319 261 23% South Asia 83 62 33% South East Asia 89 84 5% South Pacific 62 73 -15% Total 703 632 11% EBIT CY 2007 CY 2006 Growth Caribbean 7 4 81% Middle East 42 27 56% South Asia 6 2 210
Slide 28: Asian Paints Standalone - Cash Flow FY 2008
28 Asian Paints Standalone - Cash Flow FY 2008 • Operating cash flow is higher by 46.5% – Improvements in working capital • Capital expenditure for FY’08 was Rs 258 Crs – Estimated capex for FY08 was Rs. 275 Crs • Estimated Capex for FY09 is around Rs. 300 Crs
Slide 29: Key Ratios
29 Key Ratios Standalone Consolidated FY 2008 FY¥ 2007 FY 2008 FY¥ 2007 Mat cost/Net Sales 57.3% 56.9% 56.5% 59.9% PBDIT/ Net Sales 16.1% 16.4% 16.4% 14.0% PBT before EOl/ Net Sales 16.5% 14.6% 14.4% 11.6% PAT before EOI Net Sales | 11.0% 9.6%] 9.3% 7.7% asianpaints
Slide 30: Presentation structure
30 Presentation structure • Results : Q4 – FY 2008 • Results : FY 2008 • Outlook : FY 2009
Slide 31: Outlook – FY2009
31 Outlook– FY2009 India • The overall outlook for 2008-09 appears to be positive but challenging – Global financial turmoil could have an adverse impact – Impact due to the recent measures to curb inflation – Rising commodity prices including crude oil prices • Government not willing to increase pr
Slide 32: Outlook – FY2009
32 Outlook– FY2009 • International • The focus for the international business is to grow top- line and sustain profitability – The Caribbean, Middle East, South Asia and South Pacific regions should continue to perform well – In the South East Asia region, efforts to reduce losses will continue
Slide 33: Thank you...
Thank you... asianpaints