Saturday, December 1, 2012

LARSEN & TOUBRO LTD - RESULTS - Q2 FY 13 - SALES 17% UP - EBITDA 16% UP - RECURRING PAT 15% UP


LARSEN & TOUBRO LTD


Q2 FY13 Performance Highlights


30% UP - Order Inflows
11%  UP - Order Book
17%  UP - Sales
16%  UP - EBITDA
15% UP - Recurring PAT
ORDER INFLOW & ORDER BOOK – MH1 FY 13


Ø Core Infrastructure opportunities driving order inflows; Hydrocarbon tendering picking up; broadbased investment momentum in power and industrial capex yet to pick up
Ø Delay in Investment decision making continues
Ø Order Book presently at 2x+ revenues
Ø ORDER INFLOWS – Rs.406 Bn
Ø Order Book  -  Rs.1585 Bn

PERFORMANCE SUMMARY
SALES TO EBITDA

(Rs.In Bns)

Q2 FY13 :: Q2 FY12 :: % Ch:: Rs. Billn
132 :: 112:: 17% :: Net Sales(A)
27  :: 13  :: 111% :: Export Sales
100 ::  84 :: 19% :: Mfg, Cons. & Opex  
13 :: 11  ::  21% :: Staff Costs
5 :: 6 ::  -9% :: Sales, adm. & other
118 :: 100  :: 18% :: Total Opex (B)
14  ::  12  ::  16%  :: EBITDA (A-B)

Ø Robust Sales growth witnessed across project businesses driven by large order book and efficient execution
Ø FY12 International Hydrocarbon Orders translating into FY13 Exports Sales growth
Ø Increased MCO Expenses due to job mix variation , material intensity and higher sub-contracting
Ø Staff cost increase led by manpower augmentation and normal revisions / increments
Ø Reduction in Q2 SGA due to lower non-linear provisions, lesser Forex MTM, and expense control


PERFORMANCE SUMMARY
EBITDA TO PAT

Q2 FY13 :: Q2 FY12 :: % Change :: Rs.Billion
14.05 ::  12.17   ::  16%  :: EBITDA
10.7%  ::  10.8%  :: -0.1%  ::  EBITDA
(2.35) ::  (1.97)::  19%  :: Interest Expenses
(2.03) ::  (1.71):: 19%  :: Depreciation
3.29 ::  3.20 ::  3%  :: Other Income
(3.81) :: (3.70):: 3%  :: Provision for Taxes
9.15   ::  7.99 ::  15%  ::  Recurring PAT
11.37 :: 7.99 :: 42%  ::  Profit after Tax


Ø Stable Q2 EBITDA margins in line with execution progress and expense control
Ø Interest expenses are commensurate with borrowing levels
Ø Other Income in Q2 mainly on account of treasury gains
Ø Exceptional / Extraordinary items in Q2 arising out of divestment gains and Satyam provision write back; VRS charge in Q1

SEGMENTAL BREAK-UP :: H1 FY 13

Details              ::NET REVENUES :: EBITDA

Engg & Constn : : 87.6% (85.6%)  :: 83.5%(81.8%)
Electr.&Electronics : 5.8% (6.7%) :: 5.5%(5.8%)
Mach&Indl Products : 3.9% (5.7%) :: 4.9%(8.6%)
Others : 2.7% (2%) :: 6.1%(3.8%)

·       Figures in Brackets relate to corresponding Last Year Period


‘Engineering & Construction’ Segment


Ø Headway in Transportation, Urban Infra and Water Infra sectors are main drivers of Order Inflow growth; other sectors still witnessing challenging environment
Ø Sporadicity in export award decisions; some success in Hydrocarbon and Nuclear Power
Ø Revenue growth driven by large order book and superior project rollout
Ø Growth in Export sales boosted by FY12 Hydrocarbon wins
Ø Healthy margins due to execution efficiency
Ø Y-o-Y Increase in segment assets due to NWC spike
Ø EBITDA MARGINS :: 11.6% IN H1 FY 13 (11.9% IN H1 FY12)


‘Electrical & Electronics’ Segment


Ø Modest growth in sales due to subdued industrial activity and delayed customer clearances
Ø Switchboard order wins from Middle East translating into export growth
Ø Business is focusing on margin recoupment through profitable product mix, shifting of production to low cost regions, and scaling up of international business for value-added products / projects
Ø EBITDA MARGINS :: 11.5% IN H1FY 13(10.8% IN H1 HY12)


‘Machinery & Industrial Products’ Segment


Ø Dampened revenues witnessed across most businesses due to –
Ø Sluggish industrial conditions
Ø Lower offtake from wind power industry
Ø Stress on supply chain
Ø Transfer of business to subsidiary for integration purposes
Ø Mining ban continues to affect Construction and Mining business
Ø Margins adversely affected due to higher input costs and operating leverage
Ø EBITDA MARGINS : 15.4% IN H1 FY 13 (19.0% IN H1 FY 12)

‘Others’ Segment

Ø  Major revenue contributed by Integrated Engineering Services (business derived mainly from North America and European markets)
Ø  Revenue growth in Q2 and H1 aided by INR depreciation
Ø  IES currently in ramp-up phase
Ø  Margin expansion achieved through operational efficiencies and aided by currency movements
Ø  EBITDA MARGIN IN H1 FY 13 : 27.4%(23.5% IN H1 FY12)


L&T Infotech Group – H1 FY13


Ø Robust revenue growth of 28% in Q2 and 24% in H1 seen across all business segments and industry verticals
Ø Earnings aided by currency movement
Ø Positive outlook
Ø Pat :: Rs.2.72 Bn (Rs.1.98 Bn)

L&T Finance Holdings


Ø Diversified business portfolio has been an enabler of healthy growth
Ø Lower disbursements are mainly due to drop in Infra Finance disbursements and reflect the sluggishness in the current infra environment
Ø Rural segment witnessing strong growth
Ø Focus is on credit quality and sustaining NIM’s
Ø PAT Rs.2.64 Bn (H1 FY 13); 2.21 Bn (H1 FY 12); Rs.4.55 Bn FY 12

Concessions Business Portfolio

Roads and Bridges:

Portfolio: 19 projects; 10 operational, 9 under implementation
Development: 2092 km
Project Outlay: `217 Bn

Metro:

Portfolio: 1 project; under implementation
Development: 71.16 km
Project Outlay: ` 164 Bn

Power:

Portfolio: 5 projects; under development / implementation
Capacity: 2842 MW
Project Outlay: ` 212 Bn
Balance Equity Commitment (Sept 2012): ` 93
Ports:

Portfolio: 3 projects; 2 operational, 1 under implementation
Capacity: 45 Mn TPA
Project Outlay: ` 57 Bn

Ø Total Project Cost : (sep,2012) :Rs.650 Bn
Ø     Equity Invested :Rs.49 Bn
Ø Balance equity commitment : Rs.93 Bn
Annexure 1: Major Orders Booked in Q2 FY13
Domestic ::
Ø Design & Engineering, Civil, Inland Transportation, Installation, Planning, Testing and Commissioning & Allied works for Lata Tapovan Hydro Electric Project, Uttarakhand :: Rs.7.81 Bn
Ø EPC contract for four Well Head Platforms (B 127) for ONGC :: Rs.7.49 Bn
Ø EPC contract for construction of significant stretches of Kishangarh - Udaipur - Ahmedabad Highway, a part of NHDP Phase V from GMR Group :: Rs.6.45 Bn
Ø Railway electrification works between Guntakal –Raichur -Wadi stations of South Central Railway and railway construction, track work, signaling & telecommunication in the Lucknow and Izatnagar divisions of North Eastern Railway :: Rs.5.44 Bn
Ø Construction of 74 MLD water treatment plant, associated civil and Electro Mechanical & Instrumentation works for 111 villages and one town on a DBOM model, and drinking water supply project in Rajasthan :: Rs.5.18 Bn
Ø Design and Construction of Elevated Viaduct, Elevated Ramp & Five Elevated Stations etc. as part of Phase III of DMRC :: Rs.3.77  Bn
Ø Construction of 23 multistoreyed towers for a residential project :: Rs. 3.60 Bn
Ø Design and construction of four lane flyover, rail overbridges and viaduct at various locations in Kolkata :: Rs.2.75 Bn
Ø Doubling of lines on Rewari - Manheru section on Bikaner division of North Western Railway :: Rs.2.12 Bn
Ø International
Ø EPC contract for Saih Rawl depletion compression project for PDO, Oman :: Rs.13.02 Bn
Ø Supply & Installation of New 220/33 kV Grid Station and all Related 220 kV Cable/ Overhead Line works in UAE :: Rs,2.58 Bn
Ø  Construction of 11 kV distribution network and all associated HV equipment including backup generators and replacement of W42 switching station in UAE :: Rs.1.68 Bn

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