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Aditya Birla Nuvo reports results for the quarter ended 30 September 2014

12th November, 2014

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  • Revenue grew to Rs.6,597 crore
  • EBITDA is up by 26 per cent to Rs.1,516 crore
  • Net Profit surged by 56 per cent to Rs.452 crore

Rs. crore
Quarter 2 Consolidated results Half year
2013-14
(Previous Year)
2014-15
(Previous Year)
2013-14
(Previous Year)
2014-15
(Previous Year)
2% 6,492 6,597
Revenue
12,237 12,804 5%
26% 1,200 1,516
EBITDA
2,368 2,788 18%
56% 290 452
Net profit
621 716 15%

Excluding IT-ITeS Business, which was divested with effect from 9 May 2014, the quarterly revenue of Aditya Birla Nuvo (ABNL) grew year on year by 15 per cent, EBITDA rose by 34 per cent and net profit surged by 75 per cent.

Business-wise review

Aditya Birla Financial Services
Aditya Birla Financial Services (ABFS) ranks among the top five fund managers (excluding LIC) in India. Its funds under management grew by 28 per cent to US$23.1 billion (Rs.138,886 crore). Its consolidated revenue at Rs.1,775 crore registered a 16 per cent growth and earnings before tax surged by 49 per cent to Rs.237 crore. ABFS expanded its product coverage by foraying into the housing finance business. ABFS has signed a Memorandum of Understanding (MoU) with MMI Holdings Ltd., a leading South African insurance based financial services group, to enter the health insurance business in India as its tenth line of business.

Among the private life insurers, the new business premium market share of Birla Sun Life Insurance grew from 7.3 per cent to 7.7 per cent during the half year. Birla Sun Life Asset Management (BSAMC) improved its market share from 9.56 per cent to 9.69 per cent. In terms of domestic equity AUM, BSAMC moved two places up to rank 5th in the industry. Its AUM grew year on year by 30 per cent to Rs.110,233 crore. The lending book of Aditya Birla Finance expanded by 64 per cent to about Rs.13,550 crore. The Broking and the Wealth Management Businesses posted profitable growth with improved market volumes.

Fashion & Lifestyle
The company's Fashion & Lifestyle Business continued to expand its customer reach, further strengthening its leadership position. During the quarter, 108 stores were opened nationwide to reach 1,852 stores, spanning across 4.5 million square feet. Its revenue rose by 17 per cent to Rs.1,892 crore. EBITDA is up by 52 per cent to Rs.236 crore led by revenue growth and margin expansion across all the three formats - Madura, Pantaloons and Jaya Shree.

Madura's revenue soared by 25 per cent to Rs.1,051 crore, driven by double digit volume growth and EBITDA augmented by 37 per cent to Rs.161 crore. EBITDA margin stands expanded by 135 basis points.

Pantaloons' revenues extended year on year by 14 per cent to Rs. 554 crore, driven by 8.9 per cent like-to-like sales growth in the Pantaloons stores. EBITDA margin is up by 400 basis points enabled by the portfolio enrichment and improved merchandising. Pantaloons has been voted amongst India's top most trusted retailer brands in the "Brand Equity Survey 2014."

Jaya Shree registered a 13 per cent growth in revenue at Rs.351 crore and 15 per cent rise in EBIDTA at Rs.43 crore, driven by improved realisation and expansion-led volume growth in the linen segment. To strengthen its market leadership, it is expanding its linen yarn capacity from 3,400 to 6,400 tonnes per annum.

Telecom
With a base of 144 million active subscribers, Idea ranks as the 6th largest cellular operator in the world, in terms of subscribers based on operations in a single country. In India, it ranks 3rd with an improved revenue market share at 17.1 per cent up from 16.2 per cent a year ago. It posted a strong growth in earnings, on the back of rise in voice and data usage, scale benefit and cost efficiency. Its revenue is up by 20 per cent to Rs.7,566 crore and EBITDA rose by 29 per cent to Rs.2,607 crore. With cash profit generation of Rs.3,839 crore in the first half year and equity infusion of Rs.3,750 crore in June and July 2014 through QIP and preferential allotment, Idea's balance sheet has strengthened with net debt to EBIDTA at 1.32 times.

Manufacturing (Agri, Rayon and Insulators)
Revenue from the manufacturing businesses at Rs.1,161 crore amplified by 17 per cent and EBITDA at Rs.155 crore surged by 30 per cent. In the Agri Business, the debottlenecking and energy savings project resulted in higher urea sales volume and improved energy efficiency. In the Rayon Business, new superfine yarn capacity drove profitable growth in the VFY segment, though offset by lower ECU realisation in the Chemicals segment. In the Insulators Business, profitability was augmented by volume growth, which was majorly on account of spill over of contracts due to disruption/suspension of plant operations in the previous quarter.

Balance sheet
Led by the realisation of subsidy in Agri Business coupled with cash flow from operations, net debt to annualised EBITDA improved from 2.6 times in fiscal 2013-14 to 1.9 times in first half of fiscal 2014-15.

Going forward
For fiscal 2014-15, ABNL has earmarked capital expenditure of around Rs.400 crore, of which a sum of Rs.101 crore has been incurred in the first half year. The company plans to invest about Rs.350 crore in the Financial Services Business. Of this, a sum of Rs.135 crore has been invested in the first half year.

About Aditya Birla Nuvo Ltd
Aditya Birla Nuvo is a ~US$4 billion conglomerate operating in the services and the manufacturing sectors, where it commands a leadership position. Its service sector businesses include Financial Services (Life Insurance, Asset Management, NBFC, Private Equity, Broking, Wealth Management and general insurance advisory), Fashion & Lifestyle (Branded apparels & Textiles) and Telecom. Its manufacturing businesses comprise the Agri, Rayon and Insulators Businesses.

Aditya Birla Nuvo is part of the Aditya Birla Group, a US$40 billion Indian multinational. The Group operates in 36 countries across the globe, is anchored by an extraordinary force of about 120,000 employees belonging to 42 nationalities and derives more than 50 per cent of its revenue from its overseas operations.

Disclaimer: Certain statements in this "Press Release" may not be based on historical information or facts and may be "forward looking statements" within the meaning of applicable securities laws and regulations, including, but not limited to, those relating to general business plans and strategy of the company, its future outlook and growth prospects, future developments in its businesses, its competitive and regulatory environment and management's current views and assumptions, which may not remain constant due to risks and uncertainties. Actual results could differ materially from those expressed or implied. The company assumes no responsibility to publicly amend, modify or revise any statement, on the basis of any subsequent development, information or events, or otherwise. This "Press Release" does not constitute a prospectus, offering circular or offering memorandum or an offer to acquire any shares and should not be considered as a recommendation that any investor should subscribe for or purchase any of the company's shares. The financial figures in this "Press Release" have been rounded off to the nearest Rs.1 crore. The financial results are consolidated financials unless otherwise specified.