Tilaknagar Q1 net up 54% at Rs 49 cr

Tilaknagar Industries Ltd. (TI), a leading player in the Indian Made Foreign Liquor (IMFL) industry has announced its consolidated financial results for the first quarter ended June 30, 2010.

FINANCIAL HIGHLIGHTS: (All comparisons with Q1 FY2010 Figures)

• Healthy growth rate in Q1FY2011
• Total revenues at Rs 843.2 million, increased by 27.4% from Rs. 662.1 million
• EBIDTA at Rs.174.4 million from Rs. 85.4 million, registering an increase of 104.3%
• PAT reported at Rs. 48.7 million, a growth of 53.6% from Rs. 31.7 million

The current quarter performance is very promising keeping in view that historically April-June is a soft quarter given the Company’s product profile

• The current quarter result is not representative of the full year performance
• Volume growth of 51.8% to 2.11 million cases in Q1 FY2011 is encouraging
• The volume and performance growth outlook is robust on a full year basis

Basic EPS at Rs. 1.51 from Rs.1.85, due to enhanced capital base of 3.23 million shares on account of allotment of additional 1.51 million shares after July 2009

OPERATIONAL PERFORMANCE HIGHLIGHTS:

Total number of cases sold during the quarter at 2.11 million compared to 1.39 million in Q1 FY2010

During the quarter, TI’s brandy and whisky segments contributed 63% and 19% respectively of the total volume sales

Commenting on these results, Mr. Amit Dahanukar, Chairman & Managing Director, Tilaknagar Industries Ltd, said:

“I am pleased to announce healthy performance in our business operations at both top-lines as well as bottom-line this quarter. Such progress reconfirms the success of our efforts, strategy, the strengths of our business model and brands.

We continue to be focused on enhancing our presence pan India as we foray into new regions. Moreover, we are excited about the growth coming from existing as well as new brands as we expand our business. We aim to build on this momentum by introducing more premium and super premium brands in the Indian Made Foreign Liquor (IMFL) segment. The IMFL space is witnessing accelerated growth rate and it is our endeavour to capitalise on this growth. We are in the process of starting commercial production at our new grain based distillery. Going forward, this facility will enable us to manufacture superior quality alcohol, which would give us the backing to fortify our premium and higher premium brands. Moreover, we will be in a position to manufacture alcohol either from molasses or grain giving us a hedge against volatile raw material costs.

We are confident of delivering sustainable growth and drive momentum in earnings as we enhance our capabilities and expand TI’s product bouquet to create a variety of offering for our consumers.’’

OUTLOOK:

The IMFL space is expanding at a rapid pace with a surge in the consumption further aided by shift to IMFL from country liquor. This will augment volume growth in the coming years.

Given TI’s inherent strong in-house manufacturing set up and strategic tie-up arrangements, the Company is well poised to grow its market share in the IMFL domain. TI has a strong retail and institutional presence in the South and is now excited to extend its footprint in several markets pan India. The Company has acquired seven brands from Alcobrew Distilleries which are registered with CSD and have a presence in North India. The Company stands to benefit with such a brand portfolio and geographic expansion. Going forward, TI will stand to benefit from the upcoming capacity addition on account of the grain based facility. Consequently the Company will be well positioned to augment its manufacturing capabilities for producing superior quality alcohol. TI is also well placed to hedge itself against the volatility in molasses price.

With healthy performance so far and sustained efforts to grow, the Company is positioned to enhance its growth further and capitalize on market opportunities.