Sical Logistics Ltd, India’s leading provider of integrated multi-modal logistics solutions for bulk and containerized cargo and offshore logistics, today announced that the audited consolidated net profit, after prior period and exceptional items, for the year 31 March 2008 (FY 07-08) was Rs 502 million, up 11% from Rs 450.4 million a year ago. Profit before prior period and exceptional items was Rs 426.3 million, up 36% from Rs 313.6 million a year ago.

Net sales for FY 07-08 was Rs 7.1 billion, from Rs 10.5 billion a year ago, due to the demerger of the non logistics business.

Consolidated net sales of Sical’s core logistics business was Rs 6.8 billion, up 1.6% from Rs 6.7 billion a year ago.

The prior period items relate to tax adjustments in FY06-07, while the exceptional items relate to the net impact of the disposal of the non-logistics businesses like auto components unit, specialty chemicals, refractory unit and unrealized gain on restatement of foreign currency convertible bond loan and deposits.

Consolidated cash reserves, as of 31 March 2008, were Rs 2.71 billion; total debt stood at Rs 6.85 billion.

Comment by Sical Logistics Chairman, Mr. Ashwin Muthiah

On the FY ‘08 results, Sical Chairman Ashwin Muthiah said, “We are pleased to report steady business growth for FY 2008. We successfully executed our strategy of focusing on our core logistics business with the demerger of the non core business and the separation of the service and infrastructure business. This ensured dedicated management focus and helped us leverage the true potential of each business.”

“Our infrastructure projects are progressing smoothly. Over the next 2 years, most of the special purpose vehicles (SPVs) will commence operations and we envision robust growth and enhanced profitability for the Group in the long term.

We remain committed to our vision of making Sical a billion dollar company by 2012 and will continue with our efforts to enhance value for our stakeholders.” added Mr. Ashwin Muthiah.

Restructure of Sical Group

· In May 2007, Sical formed a subsidiary, Sical Infra Assets Ltd, to house the company’s asset-heavy, capital-intensive, longer gestation infrastructure based businesses like the Container Rail Project, the Container terminals at Tuticorin and Chennai in joint venture with PSA Singapore, Sical Iron Ore Terminal at Ennore, Sical Distriparks and Road and Rail terminals at Nagpur. The short cycle service oriented businesses and the asset heavy infrastructure businesses of the company were segregated to crystallize the value of investments made by Sical into its SPVs.

Demerger of Non Logistics business

· In January 08, Sical received the sanction from the Madras High Court for the de-merger of its non logistics business into a wholly owned subsidiary, Sicagen India Limited, with effect from 1 October 2006. The approval marked the successful completion of the de-merger process initiated by Sical in early 2007, and was an important step in the company’s restructuring efforts.

• The company sold its non-core businesses in FY 2007-’08, namely the manufacturing facilities and assets of the auto components division, Indrad Auto Components and the other non logistics businesses of refractory, specialty chemicals and flexible shafts.

Board appointments

• The Sical Board was restructured to include one promoter nominee director, two nominee directors, four independent directors and one managing director, with Ashwin C Muthiah as Chairman.
• Sanjiv Ralph Noronha, Mano Vikrant Singh and M Chandrasekaran were inducted as independent directors while Sudhir Rangnekar joined the Board as Sical’s Managing Director (MD) and Group CEO.

Fund raising

· In September ‘07, Sical received investment of USD 26 mn from Old Lane Mauritius IV Ltd, an investment vehicle of Old Lane India Opportunities Funds, in its newly formed subsidiary, Sical Infra Assets Ltd. The Foreign Investment Promotion Board (FIPB) approval was received by the company in November 07.

Key appointments

During the year, the following professionals joined Sical in key management positions:

· In May ‘08, S R Ramakrishnan was appointed the CEO of the Bulk logistics division, in addition to his current role as CEO Port projects. Mr Ramakrishnan previously served as MD, PSA Sical Terminals Ltd, a joint venture between PSA International Limited, Singapore and Sical. He has rich experience in developing port related infrastructure projects.

· In August ‘07, Sudhir S Rangnekar joined us from India’s leading shipping company, Shipping Corporation of India Ltd (SCI) as MD and Group CEO. Sudhir brings with him rich experience of over 30 years with India’s leading shipping company, where he last served as Director on the Board of SCI.

· In May ‘07, J Koteswari joined us from Ramco Systems as Vice President Finance. She has rich experience in corporate finance and project finance and has worked across diverse sectors in leading companies.

Key acquisition

· Sical acquired a newly built cutter suction dredger, Sical Portofino at a consideration of USD 24.92 mn in August ‘07. The acquisition marked a key step in Sical’s expansion strategy into the global offshore logistics market. Sical Portofino is classified with China Classification Society and has a length of 107 m with an average draft of 3.37m. It can dredge up to a depth of 25m and has a production capacity of 3000 cu m per hour. It is currently deployed in Chinese waters.

SPVs

· In March ‘08, Sical achieved financial closure for its greenfield iron ore terminal project at Ennore Port. The project is managed by Sical Iron Ore Terminals Ltd, promoted by Sical with 89% equity stake, and L&T Infrastructure Development Projects Ltd. It is expected to be operational by 2010.

· In March ‘08, Sical flagged off its first container train for Hindustan Copper Limited from Hatta Road, Madhya Pradesh to Patli, Haryana. Sical Multimodal and Rail Transport Ltd, the SPV managing container rail logistics services, and its network of rail terminals are slated to become the backbone of Sical’s evolution into a truly integrated multimodal logistics solutions provider in India.

· In February ‘08, Sical initiated work on the Nagpur Sical Gupta Road Terminal with the ground-breaking ceremony at the road terminal site at the Multimodal International Hub Airport at Nagpur (MIHAN).The terminal will have world-class infrastructure and state-of-the-art facilities and is expected to be operational by 2009.

· In October ‘07, Sical achieved financial closure of the Chennai International Terminals Pvt Ltd, a SPV promoted by Sical and PSA International, which is building the second container terminal in Chennai. The terminal is expected to be operational by 2009.

· In September ‘07, Sical signed a MoU signed with Jurong Port, Singapore for undertaking a detailed study to identify a Bulk Port project in India. The study is in advanced stages of closure and expected to be complete by end June 08.

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About Sical

Sical Logistics Ltd is India’s leading provider of integrated solutions for multimodal bulk and containerized logistics and offshore logistics, annually handling nearly 22 million tonnes of bulk cargo and 500,000 TEUs of containerized cargo.

Sical provides services in the following segments:

• Bulk—stevedoring; port terminals; CHA and shipping agency; trucking; railroad; warehousing
• Container—container terminals; ICD; CFS
• Offshore—platform supply vessel; cutter suction dredger

Sical's delivery network includes an exclusive walk-in berth at Chennai for ships carrying bulk cargo; a container terminal at Tuticorin; 450,000 square feet of storage across over 100 warehouses; owned and regularly contracted fleet of nearly 2500 transport vehicles; container freight stations at 3 locations across India; Sical Torino, a deepwater capable platform supply vessel in North Sea, and Sical Portofino, a cutter suction dredger deployed in Chinese waters.