Aditya Birla Nuvo reports results for the quarter ended 30 September 2015

09 November 2015

Click here to view the results

Click here to view the quarterly investor presentation

• Revenue ↑ 10% to Rs.7,285 crore
• EBITDA ↑ 13% to Rs.1,712 crore
• Net Profit ↓ 8% to Rs.414 crore

(Rs.crore)
Quarter 2			Consolidated Results	Half Year
	2014-15 (Previous Year)	2015-16 (Current Year)		2014-15 (Previous Year)	2015-16 (Current Year)
10%	6,596	7,285	Revenue	12,802	14,105	10%
13%	1,516	1,712	EBITDA	2,788	3,383	21%
8%	452	414	Net Profit	716	811	13%
Note: Pursuant to the demerger of Madura Fashion &Lifestyle into Pantaloons Fashion &Retail Ltd. (PFRL), PFRL will cease to be a subsidiary of ABNL w.e.f.1st April 2015. Pending the Mumbai High Court’s approval to the scheme, financial results of Fashion &Lifestyle business have been consolidated.

Aditya Birla Nuvo Limited (ABNL) (BSE: 500303, NSE: ABIRLANUVO, Bloomberg: ABNL IN) has reported a 10 per cent year-on-year growth in its revenue for the second quarter ended 30 September 2015. The company's EBITDA rose by 13 per cent to Rs.1,712 crore. Net profit declined by 8 per cent to Rs.414 crore mainly due to lower profitability in the Life Insurance Business.

Highlights of the results

Aditya Birla Financial Services
Aditya Birla Financial Services (ABFS) is a large non-bank financial services player that ranks among the top five fund managers in India (excluding LIC). It has built a diversified portfolio of 12 lines of businesses. Its Assets Under Management (AUM) soared by 31 per cent to Rs.181,916 crore. Its consolidated revenue grew by 21 per cent to Rs.2,144 crore and earnings before tax by 2 per cent to Rs.242 crore.

The lending book of Aditya Birla Finance Ltd. (ABFL), at Rs.19,738 crore, continues to grow ahead of the market, with a year-on-year jump of 45 per cent. With a net worth of Rs.2,773 crore, ABFL has built a quality portfolio with gross NPA at 0.90 per cent and net NPA at 0.27 per cent. The Housing Finance Business, which commenced its operations in October 2014, has almost doubled its lending book from Rs.453 crore in June 2015 to Rs.880 crore in September 2015.

Birla Sun Life Insurance ranks 4th among the private players in India with new business premium market share at 7.9 per cent. It remains the number #1 private life insurer in the Group segment. Its total premium income is up by 17 per cent at Rs.1,337 crore and AUM by 10 per cent at Rs.30,291 crore.

The quarterly average AUM (AAUM) of Birla Sun Life Asset Management (BSLAMC) has crossed the Rs.150,000 crore mark, registering a 37 per cent year-on-year growth. It has further cemented its position as India’s 4th largest asset management company with an improved market share of 10.14 per cent up from 9.69 per cent attained last year. Reflecting its focus on scaling equity assets, BSLAMC’s domestic equity AAUM extended by 66 per cent to Rs.31,104 crore and offshore AAUM surged by 145 per cent to cross Rs.15,000 crore mark.

Aditya Birla Insurance Brokers continues to gain market share. It achieved a 52 per cent growth in the premium placement during the quarter while the general insurance industry’s premium grew by 12 per cent.

MyUniverse, India’s No. 1 online personal finance management portal, enjoys the trust of over two million registered users managing more than Rs.18,250 crore through this portal. It ranks among the top 11 SIP distributors by numbers in India. It has launched a mobile app “Maxit” on Google Play Store, which aims to maximise card benefits by providing right offers, at the right places, at the right time.

MMI Holdings Ltd has received an in-principle approval from FIPB for the proposed health insurance joint venture. Regulatory approval from IRDAI is awaited.

Aditya Birla Fashion &Retail (Madura and Pantaloons)
Aditya Birla Fashion &Retail comprises Madura Fashion &Lifestyle, India’s No.1 branded menswear player and Pantaloons, India’s No.1 womenswear retailer. Trusted by 12.5 million loyalty customers, its fashion retail presence stands increased to 1,938 stores spanning 5 million square feet besides 6,000+ additional points of sales and in-house online e-commerce platform TRENDIN.COM. While its revenue grew by 8 per cent to Rs.1,670 crore, EBITDA was lower by 15 per cent at Rs.164 crore. The delayed festive season coupled with the shortening of End of Season Sale (EOSS) period affected its earnings growth.

Madura’s revenue is up by 6 per cent at Rs.1,118 crore. While its gross margin has expanded through richer product mix, despite higher discounting during EOSS, its EBITDA was lower by 15 per cent at Rs.137 crore due to moderated sales growth coupled with higher advertisement costs in line with the strategy of accelerated brands development. Madura launched 38 stores (net) during the quarter.

Pantaloons Fashion &Retail Ltd (PFRL) extended its revenue by 8 per cent to Rs. 598 crore. EBITDA at Rs. 30 crore was flat year-on-year. PFRL added seven Pantaloons stores and one factory outlet during the quarter.

Consolidation of Branded Apparel Businesses
The Scheme of Arrangement for the consolidation of the Branded Apparel Businesses under PFRL has been sanctioned by the Gujarat High Court at Ahmedabad. PFRL’s petition is listed for hearing before the Bombay High Court on 27 November 2015. The transaction is expected to complete in the next two to three months time.

Telecom (Idea Cellular)
Idea Cellular ranks 3rd in India with an improved revenue market share of 18.7 per cent up from 17.1 per cent a year ago. Having a base of 171 million subscribers, Idea is the 6th largest cellular operator in the world in terms of subscribers, based on operations in a single country. Idea’s consolidated revenue is higher by 15 per cent at Rs.8,677 crore, EBITDA by 19 per cent at Rs.3,091 crore and net profit by 7 per cent at Rs.809 crore led by rise in minutes of use and data volumes. To capitalise on the data opportunity, Idea is aggressively expanding its 3G and 4G footprints. On the back of strong quarterly cash profit generation of over Rs.2,500 crore, its balance sheet remains strong with a standalone net debt to EBIDTA at 1.99 times.

Divisions (Jaya Shree, Indo-Gulf Fertilisers, Indian Rayon and Aditya Birla Insulators)
ABNL’s divisions are India’s leading manufacturers of linen, urea, Viscose Filament Yarn (VFY) and insulators. Their combined revenue at Rs. 1,456 crore is marginally lower year-on-year due to pass through of reduction in natural gas prices in the Agri Business on account of gas pooling policy effective from 1 June 2015. EBITDA is up by 6 per cent at Rs.211 crore.

Spurred by volume growth in the Linen Fabric and Wool Segment, EBITDA of Jaya Shree Textiles rose by 13 per cent to Rs.49 crore. EBITDA of Indian Rayon soared by 15 per cent to Rs.65 crore driven by growth in VFY volumes and a higher share of superfine yarn. While Indo-Gulf Fertilisers reported a 7 per cent decline in its EBITDA at Rs.66 crore, Aditya Birla Insulators posted 11 per cent rise in its EBITDA at Rs.31 crore.

New ventures
Payments Bank: RBI has given an in-principle approval to ABNL for setting up a Payments Bank as promoter. The proposed Payments Bank will be 51:49 Joint Venture (JV) between ABNL and Idea Cellular. The JV will apply to RBI for the final grant of license which will be subject to fulfilment of certain regulatory pre-requisites. Gearing to launch its consumer services by the second half of the calendar year 2016, the JV will capitalise on Idea’s nationwide reach of 2 million+ retail distribution channel across 375,000 towns and villages and ABNL’s experience of successfully promoting and scaling up a number of consumer centric businesses.

Solar Power: ABNL has entered into a partnership with the Abraaj Group to build a large scale solar power platform in India. Aditya Birla Renewables Limited (ABReL), currently a 100 per cent subsidiary of ABNL, will bid for the solar power projects. Subject to the customary closing conditions and requisite approvals, ABNL and the Abraaj affiliate will hold 51 per cent and 49 per cent in ABReL respectively.

Balance sheet
The realisation of subsidy in the Agri Business and operating cash flows drove the reduction of net debt from Rs.3,584 crore in March 2015 to Rs.2,736 crore in September 2015. The standalone balance sheet remains healthy with net debt to EBITDA at 2.0 times and net debt to equity at 0.31 times.

Going forward
For 2015-16, ABNL will invest Rs.250 crore towards the capital expenditure plan of its divisions. ABNL also plans to fund the growth capital requirements of the Financial Services Businesses to the tune of Rs.600 crore and the equity requirements of the Solar Power Business to bid for upcoming projects.

About Aditya Birla Nuvo Limited
Aditya Birla Nuvo is a USD 4.4 billion conglomerate operating in the services and the manufacturing sectors, where it commands a leadership position. Its service sector businesses include Financial Services (NBFC, Housing Finance, Life Insurance, Asset Management, General Insurance Advisory, Private Equity, Broking, Wealth Management and Online Money Management), Fashion &Lifestyle (Branded apparels &accessories) and Telecom. It is a leading player in Linen, Agri, Rayon and Insulators Businesses. ABNL is foraying into the Health Insurance and the Solar Power Businesses. It has received an in-principle approval from RBI to set up a Payments Bank in joint venture with Idea Cellular.

Aditya Birla Nuvo is a part of the Aditya Birla Group, a USD 41 billion Indian multinational. The Aditya Birla Group is in the league of Fortune 500. Anchored by an extraordinary force of over 120,000 employees, belonging to 42 nationalities, the Aditya Birla Group operates in 36 countries across the globe. Over 50 per cent of its revenues flow 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 &strategy of the Company, its future outlook &growth prospects, future developments in its businesses, its competitive ®ulatory environment and management's current views &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.one crore. The financial results are consolidated financials unless otherwise specified.