Westa’s Sales Up By 18% YoY in 2011

February 03, 2012

Westa, a manufacturer of lead-acid batteries, announced its December production results on Thursday (Feb 2). The company increased its sales by 2% MoM and 12% YoY to 600,000 units in December 2011 while production was up by 18% MoM or 21% YoY to 630,000 units. Westa increased its full-year battery production by 20% YoY to 5.31mn conventional units in FY11, as compared to 4.43mn units in the previous year. Simultaneously, battery sales increased to 5.09mn units in 2011, representing an 18% YoY rise. Battery inventory doubled YoY to 220,000 units as of the end of 2011

COMMENTARY

Westa underperformed its latest FY11 production guidance of 5.19mn conventional units by 2% and produced 5.09mn batteries. The company had already lowered its previously announced FY11 sales forecast by 20.2% in November 2011 from 6.5mn batteries. We believe that Westa will reach its FY11 revenue guidance of USD 197mn, which was also reduced by 26% from the originally announced USD 268mn in its IPO prospect. During 9M11 the company increased its revenue and EBITDA by 31% YoY and 6% YoY to USD 124.4mn and USD 25.4mn respectively. Westa posted a net loss of USD 9.5mn in 9M11 after essentially breaking even in the same period of 2010

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