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Supreme Industries reported a consolidated net sales growth of 8% for Sep'14 quarter to Rs 759.55 crore. Thus the OP was lower by 12% to Rs 81.41 crore. There was an inventory loss of about Rs 7 crore during the quarter due to sudden fall in PVC prices. Also demand of piping business was affected due to erratic monsoon and sudden fall in raw material prices.
Other income was lower by 64% to Rs 0.38 crore. Interest costs was down by 17% to Rs 13.85 crore and depreciation was up by 47% to Rs 34.83 crore thus resulted in PBT being down by 37% to Rs 33.11 crore. Total tax being down by 36% to Rs 11.25 crore, PAT before Share of Profits from Associates was down by 38% to Rs 21.86 crore. After Rs 3.22 crore of profit from share of associates, consolidated PAT for Sep'14 quarter stood at Rs 25.08 crore, down by 42% YoY.
Consolidated Performance for the year ended June 2013
The net sales have increased by 18% to Rs 3403.98 crore. The company has processed 281452 MT of polymers, a growth of 15% and recorded net product turnover of Rs 3228.32 crore, growth of 18%.
OPM has increased by 63 bps to 15.4% due to decline in employee cost by 30 bps to 3.7% and other expenditure by 70 bps to 10.3% of adjusted net sales. As a result, the operating profit excluding construction business has increased by 23% to Rs 525.65 crore. The sales from construction business for the year stood at s 9.98 crore.
The interest cost has decreased by 4% to Rs 52.53 crore, whereas the depreciation increased by 13% to Rs 81.71 crore. The profit before tax stood at Rs 401.41 crore, a rise of 16%.
The total tax outgo stood at Rs 132.99 crore, rise of 16%. The effective tax rate stood at 33.13%. The net profit after considering share of profit from associates has increased by 20% to Rs 290.1 crore.
The promoters holding in the company is at 49.69% and none of them are pledged.
Other developments
At current polymer prices, for current year ended June'15, the company envisages an annual growth of around 18-20% in net product turnover on YoY basis.
The company has revised its capex plan to about Rs 250 crore during the year from earlier target of more than Rs 400 crore. This includes Kharagpur complex having facilities for Protective packaging products, PVC and HDPE pipe systems, Material handling products, furniture, septic tanks and water tanks, introduction of additional varieties of pipe fittings and bath fittings, premium range of furniture, moulding machines and other balancing equipments for better production efficiency in industrial product division and pipe fitting division at Jalgaon and Malanpur, new unit in Malanpur to produce Septic tanks and water tanks and to expand capacity of protective packaging products at Hosur and Malanpur and automation of plant at Jalgaon.
Construction division has negotiated sale of about 29511 sq feet premises with consideration of around Rs 46 crore and will be completed before Mar'15. After the envisaged sale, the company will have a further area of about 1.12 lac sq feet to be sold in future.
The scrip is trading at around Rs 580 on BSE.
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