FY2016 was a successful year as we grew our business increased profitability andadvanced our key strategic initiatives. This enabled us to improve our competitiveness andenhance value for our shareholders.
As I stand at this juncture I feel privileged to be a part of this winning team and tobe associated with such talented people. Our management and leadership team and ouremployees do outstanding work every single day while dealing with an extreme number ofcomplex business and regulatory issues. The way our people and our firm address thechallenges while continuing to grow our businesses fills me with pride.
Economic activity in India continues to be buoyant. The Indian economy is on asustainable and higher growth trajectory. It has shrugged off global headwinds and will besupported by brisk consumer spending and an uptick in the rural economy. Economic growthduring FY2017 is projected to be at 7.7% resulting from an expected pick-up in privateconsumption and a robust growth in agriculture on the back of two consecutive droughtyears.
Indias consumer market has a long term potential. The expansion of urban mass insize and income level will be the key driver for Indias consumption story over thenext few years. A McKinsey study states that if India continues to be on a high growthpath India will become the 5th largest consumer market by 2025. We sit with a solidleadership position in the midst of this phenomenal opportunity for growth anddevelopment.
Our Financial Performance
FY2016 was an excellent year for PML and in line with our expectations. We achievedstrong financial performance continued to successfully implement our strategy and laid astrong foundation for the future.
We continue to perform well across all metrics. Our Income from Operations and EBITDAmaintained a commendable CAGR of 53% and 41% respectively over the last five years. ForFY2016 our Total Income grew 7.4% to Rs 18097.58 million from Rs 16845.58 million inFY2015. Our EBITDA rose from Rs 7619.61 million in FY2015 to Rs 7900.34 million duringthe year. Our debt levels stood at Rs 38.76 billion as against Rs 33.08 billion at theend of FY2015. As always we continued to reward our shareholders with a healthy dividendof Rs 2.2 per share. Our commendable performance has been primarily driven by strongorganic growth in the recurring rental income from our operational malls. Other keyfactors contributing to this growth have been the increases we have made in our economicinterest in some of our SPVs and sustained sales momentum across our various on-going"for sale" residential and commercial projects.
Our Mixed-Use Development Model
The success of a good mall redefines the economics of the surrounding micro market our mixed-use developments have helped us capitalize on the significant re-pricingwitnessed in the residential and commercial segments of the micro-markets where we haveestablished our malls first and later complemented the retail portion with residentialand/or commercial developments. Our large retail-led mixed-use developments are akin to acity-within-a-city and promote lifestyle concepts such as walk-to-work and "shopdine and entertain" at home. We have the best-in-class modern infrastructurefacilities available inside each of our integrated developments in fact our mallsresemble miniature "smart-cities".
Our city-centric developments have over time evolved into landmark destinations in thegateway cities where they operate around which prominent commercial and residential hubshave sprung up. Consequently our centres are the best urban lifestyle consumptiondestinations in the key gateway cities of India resulting in the best retailers (bothforeign and domestic) forming a beeline to get space at our centres.
Our Diversified Portfolio
Brand Phoenix has truly come a long way to establish itself across multiplegeographies and asset classes. We continue to have a stable portfolio of retail-ledannuity assets which are expected to provide us with stable and predictable income streamsand growth. Additionally sales from our residential and commercial properties aregenerating sizeable free cash flows. Having delivered premium and landmark projects ourmain focus continues to be on how we can improve the efficiencies in our operationalproperties. As part of Phase II we have been delivering on our Residential projects inBengaluru and Chennai and commercial projects at Mumbai which are all under advancedstages of construction.
Responsible sustainable development
We are a responsible corporate citizen. At PML we believe that growth andsustainability of an organisation focuses on creating value in the long-term for thesociety as a whole. We also leverage the Companys core strengths and competenciesand that of its ecosystem. We also aim to address the pressing needs of the localcommunities that may not have a business connect such as during the times of Chennaifloods. In addition to this our centers being public spaces we are conscious of thenatural resources that we consume. We have taken initiatives towards optimizing energyconsumption and increasing the use of renewable energy at several of our retail andhospitality assets. We are also increasingly utilizing our malls to hold impact events forCSR-related activities and spreading social awareness including for benefit ofunder-privileged children.
PML has a proven business model dedicated staff continuing strong underlying growthand significant potential. We have created a brand that is trusted by our customers acrossmultiple asset classes through our focus on design quality and customer service. Theseare exciting times for PML which is at the forefront of enabling new lifestyles inmultiple urban centres across India.
On behalf of the management and the Board of Directors we wish to thank all our staffshareholders business partners and associates for their continued commitment and supportto The Phoenix Mills Group. Thank you for being a part of our on-going success story.
Chairman & Managing Director