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Exide Tech has a market cap of $179.3 million; its shares were traded at around $2.45 with a P/E ratio of 20.8 and P/S ratio of 0.1.
Highlight of Business Operations:Exchange Rates. The Company is exposed to foreign currency risk in most European countries, principally from fluctuations in the Euro. For fiscal 2012, the average exchange rate of the Euro to the U.S. Dollar has increased 4.5% on average from $1.32 for fiscal 2011 to $1.38 for fiscal 2012. At March 31, 2012, the Euro was $1.33 as compared to $1.42 at March 31, 2011. Fluctuations in foreign currencies impacted the Company’s results for the periods presented herein. For the fiscal year ended March 31, 2012, approximately 59.6% of the Company’s net sales were generated in Europe and ROW. Further, approximately 64.2% of the Company’s aggregate accounts receivable and inventory as of March 31, 2012 were held by European and ROW subsidiaries. To the extent foreign currencies are volatile, the Company’s financial performance will be adversely impacted.
Gross profit was $484.8 million in fiscal 2012 versus $541.3 million in fiscal 2011. Gross margin was 15.7% of net sales in fiscal 2012 compared to 18.7% of net sales in fiscal 2011. Excluding the foreign currency translation impact, gross profit decreased due to higher commodity costs, manufacturing inefficiencies due to lower production and certain operational issues and lower unit sales in Transportation Americas. Gross margin was unfavorably impacted by 60 basis points resulting from unrecovered lead costs. Foreign currency translation favorably impacted gross profit in fiscal 2012 by approximately $8.7 million. Also negatively impacting fiscal 2012 gross profit is an out-of-period adjustment of $4.6 million as discussed in Note 1 to the Consolidated Financial Statements.
Gross profit was $541.3 million in fiscal 2011 versus $510.7 million in fiscal 2010. Gross margin was 18.7% of net sales in fiscal 2011 compared to 19.0% of net sales in fiscal 2010. Foreign currency translation unfavorably impacted gross profit in fiscal 2011 by approximately $6.6 million. Excluding the foreign currency translation impact, gross profit increased by $37.3 million primarily due to higher unit sales as well as improved manufacturing efficiencies. The increase in net sales and cost of sales from lead related pricing also had a net 110 basis point unfavorable impact on gross margin.
Cash flows provided by operating activities were $91.8 million and $80.0 million in fiscal 2012 and fiscal 2011 respectively. The operating cash flows increased primarily due to decreases in inventory resulting from several inventory management and global inventory reduction initiatives, partially offset by lower operating profits.
The Company generated $0.6 million and $16.8 million in cash from the sale of non-core assets in fiscal 2012 and fiscal 2011, respectively. These sales principally relate to the sale of surplus land and buildings.
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