Home Textiles Sales Up, Profits Flat at GHCL
David Perry -- Furniture Today, August 13, 2007
Dan River parent company GHCL recorded a quarterly profit after tax of Rs 31.55, or $7.8 million, nearly flat compared to Rs 31.05, or $7.7 million for the same period one year ago. (All Rs amounts are stated here as rupee crores, using the exchange rate as of Aug. 6.)
GHCL recorded net revenues of Rs.235.50, or $58.3 million, up 42% from Rs 165.70, or $41.1 million, last year.
GHCL said profits were dampened by higher interest costs due to borrowing for its recent acquisitions.
Earnings before interest and taxes (EBIT) were lower in the home textiles division than for the company as a whole. GHCL said this was in spite of sales in the division more than doubling — and was due to the rupee appreciating against the U.S. dollar.
In milestones reached during the quarter, the company pointed to its $100 million order from Starwoods Hotels and Resorts for its recently acquired H.W. Baker Linen company, and noted that integration of Baker into Dan River is proceeding well, "with Dan River on track to leverage the client base to over 900 institutional customers."
GHCL also said Dan River "has developed over 50 vendor relationships for the outsourcing from India, China, Pakistan, Mexico, and Turkey."
"We have had a significant quarter's performance on the back of strong growth witnessed in the home textiles arena," said GHCL chairman Sanjay Dalmia.
Dalmia added, "We are approaching the time when we would be able to fully leverage our business model after successfully integrating our Indian and foreign operations both in the soda ash and textiles businesses."
The company noted that the home textiles division revenue during the quarter accounted for 36% of the total revenue.
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