Financial results of Carborundum Universal Limited

Chennai, 27th July, 2007: The Board of Directors met today and approved the unaudited financial results for the quarter ended 30th June 2007.

Q 1 FINANCIALS
Sales grew to Rs.140 crore, a growth of 23 per cent over the first quarter of last year. Exports registered strong growth of 25 per cent, from Rs.14.2 crore to Rs.17.8 crore.

The last year’s results benefited from a significant income of Rs.3.9 crore arising from sale of assets. Without reckoning the impact of this, the EBIDTA (without extraordinary items) for the current quarter recorded an increase of 29 per cent (i.e. Rs.19.5 crore to Rs.25.1 crore).The profit before tax was Rs. 16.7 crore (previous year Rs. 19.2 crore). As a result of the aggressive capital expenditure programmes undertaken by the company, interest costs for the current year was Rs. 3 crore (as compared to Rs. 0.6 crore last year).

Net profit (after tax) was Rs.11.3 crore (previous year Rs. 13 crore).

OPERATIONS

Abrasives
Abrasives achieved a sale of Rs. 95.6 crore (previous year Rs. 80.2 crore) a growth of 19 per cent. In abrasives, major customer industries – auto, auto ancillaries, bearing, steel, fabrication and construction had a good growth in Q1. The order inflow and sales of non-standard products registered strong growth rates.The Product Availability Points (PAPs) at Middle East and Canada have helped the company to step up its exports. The PAP at Netherlands has gone into full fledged operations.

Ceramics
Sales registered a 24 per cent growth, from Rs. 22.9 crore to Rs.28.4 crore. The demand from domestic key user industry segments of power generation, coal washeries, steel, cement, carbon black and glass was good. Strong growth was witnessed in both the domestic and export market.

Electrominerals
Turnover grew from Rs.19 crore to Rs.24.7 crore, a growth of 30 per cent. Sales was good both in the domestic and export markets.

The bonded abrasives project at Uttarkhand and the wear resistant liner plant at Hosur are nearing completion and are expected to be commissioned in the next quarter. Work on setting up of a new metallised cylinder plant at Hosur and the second super refractories plant at Ranipet have commenced.

OUTLOOK
With the buoyant trends in the economy continuing, the outlook looks promising with expectations of continuing growth as recorded in the first quarter. The Company is taking initiatives both to increase its manufacturing strengths and also to widen its customer reach, to enhance its growth trajectory.

About the Murugappa Group
Headquartered in Chennai, the USD $2 billion (Rs.8500 crore) Murugappa Group is India’s leading business conglomerate. Market leaders in diverse areas of business including engineering, abrasives, finance, general insurance, sanitaryware, cycles, sugar, farm inputs, fertilizers, plantations, bio-products and nutraceuticals, its 29 registered companies have manufacturing facilities spread across 12 states in India. The organization fosters an environment of professionalism and has a workforce of over 28,000 employees.

The Group has forged strong joint venture alliances with leading international companies like Roca, Cargill, Cerdak, DBS Bank, Mitsui Sumitomo and Groupe Chimique Tunisien and has consolidated its status as one of the fastest growing diversified business houses in India.

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