United Spirits Limited Volumes up 12%, Revenue up 32%, PAT at Rs.455 cr (up 1084%)

The outstanding results for fiscal year 2007 announced at the Board Meeting of United Spirits Ltd., the worlds 3rd largest Spirits Company were consistent with the pattern of results declared by the Company in the last few quarters.

From the time the Company acquired operational control of Shaw Wallace's spirits operations in June 2005, its EBIDTA figures has consistently seen quantum jumps.

Profit before non-recurring items and tax at Rs. 357.2 crore is up 597 % from the Rs. 51.2 crore for the fiscal year ended March 2006.

USL, alongwith its subsidiaries, has posted a combined operational EBIDTA (Unaudited) of Rs.506.38 crore after a charge of Rs.16.23 crore on account of acquisition expenditure.

The Earnings Before Interest, Depreciation, Tax and non-recurring items at Rs.491.4 crore is 90% higher than the earnings during the last fiscal of Rs. 258.8 crore.

Sales of key profitable brands at 61.5 million cases continued to register a double-digit growth of 19% compared to 51.6 million cases last year. A few years ago, USL had decided on a deliberate strategy to emphasize value rather than volume; as a consequence, main line brands in the portfolio now constitute 93% of the portfolio compared to 87% last year (FY'06) and 72% a few years ago (in 2001-02).

Overall volumes at 66.4 million cases represent a 12% growth over the last fiscal. Bagpiper Whisky has clocked a sale of 13.7 million cases making it the single largest brand in the alcoholic liquors domain. The McDowells No.1 umbrella brand, which has a leading presence across Whisky, Brandy & Rums, has registered a phenomenal sale of 22.8 million cases this year, which represents a 32% growth over the previous fiscal's 17.2 million cases.

Royal Challenge Whisky and White Mischief Vodka are the latest additions to the Company's 'Millionaires' list which now stands at 15. Sales of other profitable brands - Antiquity Blue, Signature, White Mischief, Romanov & Royal Challenge continue to maintain double-digit growths.

The Company has retro-fitted the molasses plant at one of its distilleries to accept grain as feedstock, thereby achieving a drop in prices of ENA (Extra Neutral Alcohol). Such measures, coupled with the down-turn in market prices of Furnace Oil and Molasses in the post-crushing season, has seen a softening in prices of the Companys primary raw material - molasses/rectified spirit. USL believes that the rates of spirit in the forthcoming quarters will be stable and marginally lower than FY'07.

As a result of the debt restructuring exercise undertaken from the proceeds of the GDR issue made by McDowell in March 2006, finance charges are down to Rs. 103 crore - 38% down from the previous fiscal.

Operational Profit before Tax for the year at Rs.357 crore is up 597% from Rs.51.2 crore. Additionally, the results also include a net income of Rs.265.7 crore comprising inter alia the profit from the sale of treasury stock of 3.8% effected in Q-III. Profit after tax therefore is up at Rs.497.5 crore compared to Rs.42 crore last year.

Source : Equity Bulls

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