Cosmo Films Limited, a global leader in films for packaging, labelling & lamination applications and synthetic paper today declared its financial results for the quarter ended December 2018. The company has grown both in terms of net revenue and EPS during the quarter.
FY19 net revenue increased by 22 percent on YOY basis due to an increase in sales volume (9 percent) and pass through of increase in raw material prices (13 percent).
The domestic film margins continued to decline until November. Besides, there was an adverse impact from one-time inventory revaluation loss of Rs.9 crores due to sudden sharp fall in raw material prices towards December end. The results were also impacted by hedging cost/forex losses of Rs.4.5 crores (vs. Rs.3.4 crores gain in the corresponding quarter).
Despite the adverse factors, the company maintained its EBITDA from an increase in export margins, tax incentives on new investment and a one-time gain of Rs 8 crores from sale of land and building in US subsidiary following the de-commissioning of the plant.
Tax Expense for the quarter ended 31 December’18 is net of a deferred tax credit of Rs 3.7 crores with respect to temporary differences pursuant to the filing of Income Tax Return for AY 2018-19.
Commenting on the financial performance of the company Mr Pankaj Poddar, CEO, Cosmo Films Ltd. said, “The demand and supply situation has started to get better with demand growth outpacing supply and the price recovery may start happening in the foreseeable future. The company has also stabilised its sales from additional capacity and therefore can better focus on improving prices and sales mix.
The US thermal film plant has been relocated to India. Shifting to India shall help the company optimize cost and help improve capacity utilization. The thermal film for sales in the USA shall henceforth be entirely supplied from India.”