Aditya Birla Nuvo reports results for the quarter ended 31 December 2014

10 February 2015

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• Revenue grew to Rs.6,640 crore
• EBITDA is up by 15 per cent to Rs.1,484 crore
• Net profit increased by 7 per cent to Rs.368 crore

Rs. in crores
Quarter 3			Consolidated Results	9 months
	2013-14 (Previous Year)	2014-15 (Current Year)		2013-14 (Previous Year)	2014-15 (Current Year)
1%	6,545	6,640	Revenue	18,781	19,444	4%
15%	1,296	1,484	EBITDA	3,664	4,272	17%
7%	345	368	Net Profit	967	1,084	12%
20%	307	368	Net profit (Ex-IT-ITeS business and before one-off items)	802	1,120	40%
One-off items: During nine months last year, profit is higher by Rs.65 crore on account of slump sale of Carbon Black Business. During nine months in the current year, profit is lower by Rs.36 crore on account of net loss of Rs.23 crore from operations of Minacs for the period from 1 April 2014 to 8 May 2014 and exceptional loss of Rs.13 crore pertaining to the divestment of Minacs. This loss is without considering deferred grant of Rs.42 crore receivable over next three years, which will be accounted for on actual receipt basis.

Revenues for the quarter at Aditya Birla Nuvo (excluding IT-ITeS Business which was divested w.e.f. 9 May 2014 and before one-off items) grew year on year by 14 per cent, EBITDA rose by 21 per cent and net profit increased by 20 per cent.

Aditya Birla Nuvo (ABNL) has applied for Payments Bank license in accordance with RBI guidelines. ABNL will be the promoter of the proposed Payments Bank, holding 51 per cent of its equity capital. Idea Cellular will hold the balance 49 per cent, which may be increased to 60 per cent if permitted from time to time with regulatory approval.

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 year-on-year by 26 per cent to US$24.6 billion (Rs.147,388 crore). Its quarterly consolidated revenue at Rs.1,913 crore registered a 30 per cent year-on-year growth and earnings before tax grew by 10 per cent to Rs.202 crore. ABFS posted an ROACE of 23 per cent per annum during these nine months. ABFS is ramping up its online and offline distribution reach and entering into strategic partnerships to tap sector growth opportunities. A definitive agreement was signed with IFC for strategic investment in MyUniverse, India’s #1 online money management portal. ABFS is also planning to enter health insurance business in India through joint venture with MMI Holdings Ltd, a leading South African insurance-based financial services group.

The lending book of Aditya Birla Finance expanded year-on-year by 53 per cent to Rs.15,475 crore. Its loan book continues to be healthy. Its gross NPA stands at 1.22 per cent and net NPA at 0.43 per cent. The new business premium market share of Birla Sun Life Insurance, among the private life insurers, rose year-on-year from 6.6 per cent to 7.5 per cent during April to December 2014. The total AUM of Birla Sun Life Asset Management is up by 27 per cent year-on-year to Rs.117,489 crore led by 98 per cent growth in its domestic equity AUM. The broking business improved its market share in retail F&;O, commodities and currency segments. MyUniverse is enjoying trust of 1.3 million registered users and is managing more than Rs.14,700 crore.

Fashion & Lifestyle
The revenue of the Fashion &Lifestyle Business extended by 8 per cent to Rs.1,676 crore. EBITDA de-grew from Rs.192 crore to Rs.168 crore. Soft consumer spending and weak festive sales coupled with pricing pressure impacted earnings growth across the industry. Led by sound working capital management, ROACE during these nine months continued to be robust at 32 per cent per annum.

Madura’s revenue augmented by 7 per cent to Rs.913 crore. EDITDA de-grew from Rs.116 crore to Rs.102 crore due to weak customer footfalls and higher discounting. Pantaloons revenues increased year-on-year by 7 per cent to Rs.450 crore. EBITDA de-grew from Rs. 35 crore to Rs. 31 crore given the moderated sales growth. Jaya Shree reported a marginal uptake in revenues to Rs.336 crore. EBIDTA de-grew from Rs. 50 crore to Rs. 35 crore constrained by lower linen fabric realisation and wool combing sales owing to weak demand.

Telecom
With a base of 152 million active subscribers, Idea ranks as the sixth largest cellular operator in the world, in terms of subscribers, based on operations in a single country. In India, it ranks third with an improved revenue market share at 17.2 per cent up from 15.8 per cent a year ago. Its consolidated revenue rose by 21 per cent to Rs.8,009 crore and EBITDA surged by 36 per cent to Rs.2,885 crore. With cash profit generation run rate of Rs.2,000 crore per quarter and equity infusion of Rs.3,750 crore, Idea’s net debt reduced by more than Rs.8,250 crore during nine months and net debt to EBIDTA ratio improved to 1.12 times.

Manufacturing (Agri, Rayon and Insulators)
The revenue from the manufacturing businesses at Rs.1,186 crore expanded by 7 per cent and EBITDA at Rs.141 crore enhanced by 19 per cent. In the Agri Business, improved energy efficiency, higher fixed cost reimbursement as per the Government policy and increased sales of pesticides and seeds augmented profitability. In the Rayon Business, profitable growth in VFY segment was offset by lower caustic soda volumes owing to annual maintenance shutdown in power plant and softening of ECU realisation. In the Insulators Business, a rise in volumes coupled with higher realisation, mainly to pass on the rise in operating costs, contributed to the earnings growth.

ABNL’s standalone balance sheet
Net debt reduced to Rs.2,836 crore led by operating cash profit and lower net working capital. Net debt to annualised EBITDA improved from 2.6 times in March 2014 to 2.3 times in December 2014.

Going forward
For fiscal 2014-15, ABNL has a capital expenditure and investment plan of about Rs.900 crore, towards funding of growth capital requirement in Financial Services Businesses and capex plan of standalone businesses. Of this, a sum of Rs.327 crore has been incurred in the first nine months.

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, Housing Finance, Private Equity, Broking, Wealth Management, online money 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.

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