Bharat Forge Limited
NSE Symbol BHARATFORG
INTRODUCTION
Bharat Forge Limited (BFL), the flagship company of the USD 2.4 billion Kalyani Group, manufactures various forged and machined components for the automotive and non-automotive sector.
BFL is today among the largest and technologically most advanced manufacturer of Forged & Machined components. As one of India’s emerging multinationals, the company has manufacturing operations across 11 locations and 5 countries - 4 in India, 3 in Germany, one each in Sweden, USA & 2 in China and one each in Sweden & USA.
Its customers include the top five Passenger Car & top five Commercial Vehicle Manufacturers in the world. The list includes virtually every automotive OEM and Tier I companies.
Backed by a full service supply capability and dual-shore manufacturing model, Bharat Forge provides end-to-end solutions from product conceptualization to designing and finally manufacturing, testing and validation.
STAND ALONE & CONSOLIDATED
RESULTS COMPARISON
As per the company Press releases :
Bharat Forge Ltd announced its Q1 results with combined and standalone revenue reaching Rs. 1,013 crores & Rs 640 crores respectively.
Stand-alone revenue & EBIDTA for Q1 reached Rs. 640 crores and Rs. 168.8 crores, a YoY growth of 76.0% & 110.7% respectively.
Combined revenue & EBITDA for the quarter was 1,013 crores and Rs 184.6 cores, a YoY growth of 66.3% & 214.5% respectively.
The Wholly Owned Subsidiaries have recorded a strong performance in this
quarter. Revenues have grown by 51.9% to Rs 372 crores while EBITDA for the quarter was Rs 15.8 crores as against a loss at EBITDA level of Rs 21.4 crores in the corresponding quarter previous year.
The turnaround in performance of the subsidiaries is on account of restructuring of operations which were carried out last year and improvement in automotive demand environment in Europe.
Exports for the quarter grew by 63.2% on a YoY basis to reach Rs 232.9 crores with growth across all geographies and market segments.
Financial Highlights Q1
Bharat Forge Stand alone Financials
Revenue
• Domestic revenues grew by 84.0% & 15.9% on a YoY and QoQ basis
despite a 12.3% QoQ drop in domestic M&HCV volumes.
• Exports continued to grow for the 5th straight quarter driven by recovery in both US & European markets. Export revenues grew by 63.2% & 6.0% on a YoY and QoQ basis.
• EBITDA margins have expanded both on a YoY & QoQ basis to 25.2% in Q1 FY11 driven by improved operating leverage.
• Utilization for Indian operations improved on the back of continued strong off-take from domestic OEM’s coupled with improvement in utilization of new facilities and continuing recovery in export markets.
Combined financial statement
The combined financial statement for the Q1 FY 2011 for Bharat Forge & its
Wholly Owned Global Subsidiaries is as follows:
Rs.in Million
Particulars Q1 FY11:: Q1 FY 10 :: Q4 FY 10
Total Revenue 10,126 :: 6,089 :: 9,239
EBITDA 1,846 :: 587:: 1,614
EBITDA % 18.2%:: 9.6%:: 17.5%
PBT bef.Excep. Item::906 :: (204) :: 732
Exchange gain/(Loss)::15 :: (88) :: 36
Redundancy Cost :: - :: (160) :: -
Profit after Taxation::620 :: (461) :: 560
The subsidiaries’ performance in the quarter is significantly influenced by the
following factors:
1. Improvement in capacity utilization across the subsidiaries from 25% in
Q1 FY10 to 39% in Q1 FY11.
2. The restructuring actions carried out in CY09 with aim of lowering the
break even levels are starting to positively impact the financial
performance. EBITDA % for the overseas subsidiaries has improved to
4.2% in this quarter from 2.5% in Jan – Mar 2010.
3. China JV has turned the corner and has posted a profit for the first time
since the commencement of operations in April 2006.
The company is quite optimistic that the international operations will continue to show improvement in performance and be profitable this year and further gain momentum with recovery in automotive markets in Europe in CY 2011.
Outlook
The automotive markets in both India & the export markets, especially USA are on a steady growth trajectory. The demand in India is being driven by strong economic activity led by infrastructure & capital goods. The entry of global OEM’s into the Indian markets bode well for both the industry and BFL.
The recovery in the US automotive markets, visible from the half-yearly
numbers is an encouraging sign. The strong performance of the US Class 8
heavy truck segment in CY10 on the back of economic revival in the US &
improved freight demand is expect to gather momentum in to the 2nd half of CY10 and well in to CY11 in what could turn out to be a long and much awaited recovery cycle.
Non Automotive Business
BFL non auto business in Q1 FY11 contributed 33% of sales as against 28% in Q4 FY10. This has been on the back of increased utilization from the new non auto facilities.
The quarter witnessed continued improvement in utilization levels from the
new facilities on the back of commencement of production for new production & ramp up of on going programs across sectors such as energy, transportation and Oil & Gas. The utilization levels should see a continued uptrend in the coming quarters on the back of commencement of production of new programs.
The non auto business continues to witness strong traction with order wins for products such as rings, blow out preventers, crankshaft & wind shafts from customers in Wind, Oil & Gas and other sectors.
The order pipeline on the non auto front is increasing and should lead to
improvement in utilization of the new capacities and add to profitability of the company.
Conclusion
• The Domestic automotive business is on a strong footing and should be
able to continue to grow inline with the growth expected in the Indian
automotive market.
• Export markets are clearly on the recovery mode led the US Class 8
heavy trucks and the stability in volume in Europe.
• Improvement in performance of the Wholly Owned Subsidiaries (WOS)
and the turnaround in China operation are expected to continue going
forward.
• Utilization from new non auto facilities should continue to increase going
forward driven by stable volumes, new orders wins & commencement of
production on other programs.
Q1 FY 2011
Stand alone results
While the preceding info was taken from the press releases, the following table is compiled from results data. The table is self explanatory. Dif%1 is between Jun10 and Mar’10 quarters’ figures. Dif%2 is between June ’10 and june’09 quarters figures. Dif%3 is as to how Jun’10 compares proportionately (June10 x 4) with full year stand-alone figures (FY10 NC). As can be seen from these, stand alone figures represent good progress.
Jun-10 | Mar-10 | Dif%1 | Jun-09 | dif%2 | dif%3 | ||
Net Sales | 60850 | 54649 | 11.3 | 35158 | 73.1 | 181401 | 34.2 |
Other OptgIncome | 2159 | 1588 | 36 | 706 | 205.8 | 4239 | 103.7 |
Raw Materials | 31161 | 26893 | 15.9 | 15023 | 107.4 | 84957 | 46.7 |
Employees Cost | 4565 | 3468 | 31.6 | 3593 | 27.1 | 14357 | 27.2 |
Depreciation | 4682 | 4428 | 5.7 | 3841 | 21.9 | 16444 | 13.9 |
Other Expen | 14512 | 14108 | 2.9 | 8519 | 70.3 | 45342 | 28 |
Total Expenditure | 51819 | 46606 | 11.2 | 32216 | 60.8 | 158385 | 30.9 |
Profit from Opera | 11190 | 9631 | 16.2 | 3648 | 206.7 | 27255 | 64.2 |
Other Income | 1014 | 1204 | -15.8 | 518 | 95.8 | 3234 | 25.4 |
P B I EI | 12204 | 10835 | 12.6 | 4166 | 192.9 | 30489 | 60.1 |
Interest | 2993 | 2611 | 14.6 | 2535 | 18.1 | 10277 | 16.5 |
P A I B B EI | 9211 | 8224 | 12 | 1631 | 464.7 | 20212 | 82.3 |
P B T | 8788 | 8159 | 7.7 | 145 | 5961 | 18071 | 94.5 |
Tax expense | 2845 | 2033 | 39.9 | 49 | 5706 | 5367 | 112 |
PAT | 5943 | 6126 | -3 | 96 | 6091 | 12704 | 87.1 |
Net Profit | 5943 | 6126 | -3 | 96 | 6091 | 12704 | 87.1 |
Dividend (%) | - | 50 | - | 50 | |||
Face Value.Rs | 2 | 2 | 0 | 2 | 0 | 2 | |
Paid Up Equity | 4657 | 4454 | 4.6 | 4454 | 4.6 | 4454 | |
Reserves | - | - | - | 148267 | |||
Basic EPS | 2.59 | 2.76 | -6.2 | 0.04 | 6375 | 5.71 | 81.4 |
Public holding% | 57.94 | 56.03 | 3.4 | 56.03 | 3.4 | 56.03 |
ANNOUNCEMENTS
TO THE EXCHANGE
26-07-2010 Bharat Forge Limited has informed the Exchange regarding the standalone Results for the quarter ended on 30-JUN-2010 as follows: Net Sales of Rs. 60850 lacs for quarter ending on 30-JUN-2010 against Rs. 35158 lacs for the quarter ending on 30-JUN-2009. Net Profit / (Loss) of Rs. 5943 lacs for the quarter ending on 30-JUN-2010 against Rs. 96 lacs for the quarter ending on 30-JUN-2009.
30-06-2010 Bharat Forge Limited has informed the Exchange that the Register of Members and Share Transfer Books of the Company will remain closed from July 17, 2010 to July 26, 2010 (both days inclusive) for the purpose of determining entitlement to dividend of Re. 1.00 per share (50%) for the year ended on March 31, 2010, which the Board of Directors have recommended after consideration of accounts at their meeting held on May 22, 2010.
07-06-2010 Bharat Forge Limited has informed the Exchange regarding a press release dated June 04, 2010 , titled "BHARAT FORGE and KPIT CUMMINS to Form a Joint Venture; Announce 'New Hybrid Technology Solution' for Automobiles; Unveil 'REVOLO'- A Smart and Sustainable Solution that Redefines Mileage Standards".
04-06-2010 Bharat Forge Limited has informed the Exchange that "Bharat Forge Ltd., the flagship company of the USD 2.4 billion Kalyani Group and a leading global supplier of forged and machined components and KPIT Cummins Infosystems Ltd., a leading product engineering & IT consulting partner to automotive and manufacturing companies have today announced their decision to form a joint venture to manufacture an indigenously developed hybrid technology solution for automobiles."
01-06-2010 Bharat Forge Limited has informed the Exchange vide its letter dated June 1, 2010 "Bharat Forge Limited & KPIT Cummins Infosystems Ltd. jointly plans to make a technology announcement on June 4, 2010 at New Delhi". -
22-05-2010 Bharat Forge Limited has informed the Exchange that the Board of Directors at its Meeting held on May 22, 2010, taken on record that the Company has received a contract for EPC for an Independent Power Project (IPP) for a 3 X 150 MW Power Project. The Board has authorized the Company to execute the EPC activity under 100% subsidiary of Bharat Forge Limited.
22-05-2010 Bharat Forge Limited has informed the Exchange that the Board of Directors at its meeting held on May 22, 2010 have recommended a Dividend of Rs.1/- per Equity Share (50%), subject to approval of shareholders.
22-05-2010 Bharat Forge Limited has informed the Exchange regarding a press release dated May 22, 2010 , titled " Performance for the quarter & Year ended March 31, 2010; Impressive Standalone topline Growth of 92.3% & PBT of Rs. 82 crores for the Quarter".
29-04-2010 Bharat Forge Limited has informed the Exchange that the Committee of Boards of Directors of the Company at its meeting held on April 28, 2010 has allotted following securities to the Qualified Institutional Buyers under Qualified Institutional Placements (QIP) : (1) 10,000,000 Equity Shares of Rs.2 each at a price of Rs. 272 per Equity Share (including premium of Rs.270 per Equity Share), aggregating to Rs.2,720 million; (2) 1760, 10.75% Secured Redeemable Non-Convertible Debentures of face value of Rs.1000,000 aggregating to Rs.1,760 million, along with; (3) 6,500,000 Warrants at a warrant issue price of Rs.2 per Warrant, aggregating to Rs.13 million. The warrant holder is entitled to exchange each said warrant with one Equity Share, at any time during the warrant exercise period, at a warrant exercise price of Rs. 272 per Equity Share.
22-04-2010 Bharat Forge Limited has informed the Exchange that "The audited unconsolidated financial statements for the year ended 31st December, 2009 of the following subsidiaries namely, CDP Bharat Forge GmbH, Germany; Bharat Forge Aluminiumtechnik GmbH & Co. KG, Germany; Bharat Forge Kilsta AB, Sweden; Bharat Forge Scottish Stampings Ltd., UK; Bharat Forge America Inc., USA and FAW Bharat Forge (Changchun) Co. Ltd., China have been hosted on the Company's website - www.bharatforge.com. The audited unconsolidated financial statements in respect of these foreign subsidiaries have been prepared in accordance with the Generally Accepted Accounting Principles ('GAAP') of the respective Country".
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