UFLEX Ltd Q2 FY11-12 Net Profit at Rs. 57 crore

Uflex Ltd, the Bombay Stock Exchange (UFLEX: 500148) and NSE listed, India's largest flexible packaging company has achieved the consolidated revenue for the September quarter of 2011 of Rs. 1097  crore as against Rs. 859 crore for the same quarter last year, up 28%. The higher revenue growth is attributed to new capacity expansion ,  & increased utilization. However, the consolidated net profit for the quarter ended 30^thSept, 2011 has been lower at Rs. 57 crore  as against Rs. 203 crore for the same period last year.  The lower profit has been due to drop in gross margins of PET film and higher input & other operating costs during the said period.

For the six months period ended September 30, 2011, UFlex recorded lower net profit of Rs. 153 crore against Rs. 263 crore in the corresponding period last year stood at Rs. 2244 crore compared  to Rs. 1551 crore in the same period in previous fiscal, up by 45%.

According to Mr. Ashok Chaturvedi, Chairman and M.D. of UFLEX Ltd, “This quarter has not been a good quarter in terms of profitability due to pressure on margin of PET film both in domestic & international market but the new capacity expansion, higher capacity utilization and the growth in sales volume continue to be strong which is a reflection of strong fundamentals and strength of the company of its business. We are well positioned to pursue our strong growth potential and are moving forward with several development projects to further enhance shareholder value.”

UFLEX is continuing with its strategy of capacity expansion and adding manufacturing lines for new product categories across facilities in Mexico, Egypt, India, Poland & USA – not only to increase proximity to the markets, but also to bring broad portfolio of value added products to its clients at competitive price points.

In the first half of the current financial year (H1 FY11-12), Uflex Ltd completed the expansion of its facility in Mexico in the quarter ended June 30, 2011. This facility has trade pacts and part of NAFTA and thus access to a large market like North America. The expansion here was in two phases of 30000 MT capacity each, aggregating a total capacity of 60000 MT, and involving total capital investment of USD  110 million.

The company also commissioned an AL-OX coater and CPP plant  for Packaging films at its Egypt plant in 6th of October City, near Cairo. With this, UFLEX joins the list of handful manufacturers, capable of producing ALOX-coated films and CPP film. The new line of PET film of 30,000 MTs is expected to be commissioned by December, 2011.

The major portion of the expansion of manufacturing of Packaging products at Jammu has also been completed by September, 2011.

                                 

Earlier, Uflex had initiated the setting up of a new plant for manufacturing of 30,000 MTs of polyester film at Poland. The company will set up the plant in Wrzesnia with an investment of $80 million (around Rs 360 crore), which is expected to be operationalised by June 2012.

The Company also announced plans to invest total USD 180 MLN to set up polyester film plants in Kentucky, US with an annual capacity of 60,000 metric tonnes. The 1^st phase will start production by December 2012 having annual capacity of 30000 MTs.

Uflex is the only integrated unit of its kind in the world with flexible packaging at its core. It has vast capacities for production of Polyester chips, Biaxially Oriented Polyethylene Teraphthalate (BOPET films) and Biaxially Oriented Polypropylene (BOPP) films, Printing & Coating Inks, facilities for Holography, Metalization & PVDC coating, making Gravure Printing Cylinders & Flexo Printing plates, Gravure Printing, Lamination and Pouch formation.

The company's partial client list includes Unilever, Pepsi, Wrigley, Procter & Gamble, Colgate, Palmolive, Nestle, Gillette, Ranbaxy, Perfetti, Joyco, Monsanto, ITC, Godrej Pillsbury, Tata Tea, Hindustan Petroleum, Indian Oil, Britannia, Dabur, Haldiram, Wockhardt, HUL, Parle Biscuit, and Birla 3M, among others.

About UFLEX Ltd

UFLEX Ltd (www.uflexltd.com) is the Bombay Stock Exchange (UFLEX: 500148) and NSE listed India's largest flexible packaging company with large manufacturing capacities of plastic film and packaging products providing end-to-end solutions to clients across more than  114  countries. It has vast capacities for production of Polyester chips, Biaxially Oriented Polyethylene Teraphthalate (BOPET) and Biaxially Oriented Polypropylene (BOPP) films, Printing & Coating Inks, facilities for Holography, Metalization & PVDC coating, making Gravure Printing Cylinders, Gravure Printing, Lamination and Pouch formation.

Synonymous with flexible packaging industry in the country, UFLEX group has Gross annual revenue of Rs. 47 billion and Gross Capital Investment across the world of about Rs. 32 billion. UFLEX offers finished packaging of a wide variety of products such as snack foods, candy and confectionery, sugar, rice & other cereals, beverages, tea & coffee, desert mixes, noodles, wheat flour, soaps and detergents, shampoos & conditioners, vegetable oil, spices, marinates & pastes, cheese & dairy products, frozen food, sea food, meat, anti-fog, pet food, pharmaceuticals, contraceptives, garden fertilizers and plant nutrients, motor oil and lubricants, automotive and engineering components etc...

Innovative Concepts Shaping the growth of the Packaging Industry

Unlike earlier when packaging used to be an afterthought for many manufacturers, the packaging industry today is witnessing number of changes, owing to increased consciousness amongst consumers as well as manufacturers.  More and more packaging companies today have moved towards environmentally responsible packaging which has become an integral part of their businesses.
As the packaging companies are focusing on sustainability initiatives through waste minimization and drifting towards environmentally responsible ‘green packaging,’ these trends are driving the product innovation in the packaging industry.
According to an international survey by Accenture, that included corporate decision-makers in the U.S., U.K., and China, out of the 247 businesses contacted, 72 per cent say that their sustainability initiatives fruitful and delivered results beyond expectations. This clearly reflects that with growing concern, consciousness and increased consumer awareness, packaging industry today is turning green.
What started as PlantBottle (30% of the bottle is plant based) by Coca-Cola has inspired peers and others in the industry for product innovation and companies across the globe, including the Indian flexible packaging giant Uflex have been making use of green and environment-friendly packaging materials.
Moving away from plastics, some of the common packaging materials that are now being used by packaging companies include:
Bamboo: Renewable and easy to grow, Bamboo is being increasingly used right from packaging to clothing in the western world. Due to its antibacterial properties and ability to naturally wick moisture, Bamboo has become a preferred material and is made use in shipping by top brands, including Dell.
Ecocradle: 100 percent biodegradable and renewable, Ecocradle is a great replacement to EPS, EPP and EPE foams made from oil or natural gas. A product grown from mushrooms, Ecocradle has become a preferred choice being non-toxic and non-disruptive to the environment.
Cornstarch Peanuts:  100% biodegradable and edible, cornstarch packaging peanuts are just amazing as they dissolve safely in water or can be thrown into the compost bin. Cornstarch peanut are used in packaging for not being a sustainable option but also because of their ability to not shrink in humid conditions and having a high density for rugged durability.
With packaging industry moving towards sustainability, packaging companies worldwide have been focusing on product innovation with the use of non-plastic and biodegradable packaging materials and at the same time maintaining the products look and feel.

Uflex Announces Dividend of 75%

Uflex Ltd, the Bombay Stock Exchange (UFLEX: 500148) and NSE listed, India’s largest flexible packaging company has announced dividend @ 75% (Rs. 7.50 per equity share) for the financial year 2010-2011. Standing on its long-term commitment to the shareholders, the company declared the dividend at the meeting held on September 10, 2011. The dividends will be dispatched to the members on September 21, 2011.

The announcement of the dividend is backed by company’s robust business growth and a 58% increase in its consolidated net profit before extra ordinary income for the quarter ended June 30, 2011 at Rs. 95.57 crore as against Rs. 60.50 crore for the same period last year.

The firm's consolidated revenue for the June quarter of 2011 stood at Rs. 1109.26 crore as against Rs. 660.63 crore for the same quarter last year, up 67.9%. The higher revenue growth is attributed to new capacity expansion globally and increased uptake of innovative flexible packaging solutions offered by the company across sectors.

According to Mr. Ashok Chaturvedi, Chairman and M.D. of UFLEX Ltd, “We have declared dividend of 75% as a part of our commitment of further strengthening our relationship with our valued shareholders. At Uflex, our focus has been to provide innovative end-to-end solutions to our discerning clients, which is reflected in our improved financial performance consistently over the years.  We are in a process of adding new facilities at the existing facilities and strengthening our global footprint by entering new markets and exploring better possibilities. Our growth is backed by the undeterred support of our clients and our employees who are a significant part of our growth story and we are happy to announce the roll-out of the dividend to the members.’’

Earlier this year, Uflex Ltd has completed the expansion of its facility in Mexico in the quarter ended June 30, 2011. This facility has trade pacts and part of NAFTA and thus access to a large market like North America. The expansion here was in two phases of 30000 MT capacity each, aggregating a total capacity of 60000 MT, and involving total capital investment of USD 109 million.

The company recently commissioned an AL-OX coater for Packaging films at its Egypt plant in 6th of October City, near Cairo. With this, UFLEX joins the list of handful manufacturers, capable of producing ALOX-coated films.

 

Uflex recently initiated the setting up of a new plant for manufacturing of 30,000 MTs of polyester film at Poland. The company will set up the plant in Wrzesnia with an investment of $80 million (around Rs 360 crore), which is expected to be operationalised by June 2012.

The Company had recently announced plans to invest total Rs 380-crore to set up polyester film plants in Kentucky, US with an annual capacity of 60,000 metric tonnes. The 1^st phase will start production by December 2012 having annual capacity of 3000 MTs.

Uflex is the only integrated unit of its kind in the world with flexible packaging at its core. It has vast capacities for production of Polyester chips, Biaxially Oriented Polyethylene Teraphthalate (BOPET) and Biaxially Oriented Polypropylene (BOPP) films, Printing & Coating Inks, facilities for Holography, Metalization & PVDC coating, making Gravure Printing Cylinders & Flexo Printing plates, Gravure Printing, Lamination and Pouch formation.

The company's partial client list includes Unilever, Pepsi, Wrigley, Procter & Gamble, Colgate, Palmolive, Nestle, Gillette, Ranbaxy, Perfetti, Joyco, Monsanto, ITC, Godrej Pillsbury, Tata Tea, Hindustan Petroleum, Indian Oil, Britannia, Dabur, Haldiram, Wockhardt, HUL, Parle Biscuit, and Birla 3M, among others.

About UFLEX Ltd

UFLEX Ltd (www.uflexltd.com) is the Bombay Stock Exchange (UFLEX: 500148) and NSE listed India's largest flexible packaging company with large manufacturing capacities of plastic film and packaging products providing end-to-end solutions to clients across more than 108 countries. It has vast capacities for production of Polyester chips, Biaxially Oriented Polyethylene Teraphthalate (BOPET) and Biaxially Oriented Polypropylene (BOPP) films, Printing & Coating Inks, facilities for Holography, Metalization & PVDC coating, making Gravure Printing Cylinders, Gravure Printing, Lamination and Pouch formation.

Synonymous with flexible packaging industry in the country, UFLEX group has Gross annual revenue of Rs. 47 billion and Gross Capital Investment across the world of about Rs. 32 billion. UFLEX offers finished packaging of a wide variety of products such as snack foods, candy and confectionery, sugar, rice & other cereals, beverages, tea & coffee, desert mixes, noodles, wheat flour, soaps and detergents, shampoos & conditioners, vegetable oil, spices, marinates & pastes, cheese & dairy products, frozen food, sea food, meat, anti-fog, pet food, pharmaceuticals, contraceptives, garden fertilizers and plant nutrients, motor oil and lubricants, automotive and engineering components etc...

Neeraj Atri,

Mavcomm Consulting,

+91 9811714871,

n.atri@mavcommgroup.com