5:30PM Mumbai - Ambuja Cements 2007 net profit increases 32% on sales increase of 18%.

Full year Earning Review

Ambuja Cements net profit after tax rose 32% to 1,769 core rupees during the full year ended December 2007 from a year ago.

During the year, revenue increased 18% on increased volume to 5,898.3 crore rupees from 4,948.4 crore rupees in 2006.

EBITDA, earnings before depreciation, Interest, taxes and amortization, a measure of operating profit rose 20% to 2,239 crore rupees. Higher fuel, freight, and raw materials costs depressed the margins. Profit after exceptional items and taxes increased 23% to 1,926 crore rupees. EBITDA margins fell from 38.8% to 37.96% on higher operating costs.

Abuja Cements said the board recommended a dividend 1 rupee per share.

The company recorded provision of 29 crore rupees for the loss in value of its investment in a subsidiary Ceylon Ambuja Cements and exceptional gain of 815 crore rupees from the sale in affiliated company.

Dividend Declared

The board recommended a final dividend of one rupee per share in addition to 1.20 rupees of regular interim dividend and 1.30 rupees per share of exceptional income.

Projects Update

Ambuja Cements managing director A L Kapur said in the accompanying statement in the press release that clinker facility expansion at Bhatapara and Rauri locations with individual capacity of 2 million tons is on track.

The company estimated total expansion project cost of 3,500 crore rupees.

In the year, Kapur said the company commissioned new grinding facilities each with cement capacity of 1 million. He said work has also commenced on a new 1.5 million tons grinding unit at Amdavad, Gujarat and bulk cements terminal at Cochin in Kerala.

The company is looking to at a new project at an undisclosed location and plans to invest approximately 3,000 crore rupees over the next three years.

Outlook

The company sounded positive note and said that in the short term growth may moderate in the short term but demand for housing will support “robust demand in cement.”

The company is one of the three largest cement producers in India. Top three companies hold 52% and its debt to equity ratio has consistently declined from 1.10 in 2001 to 0.25 in the fiscal 2006.