Wendt (India), a leading manufacturer of super abrasive grinding wheels and special purpose grinding machines/tools has registered 6% growth in standalone sales (net of excise) to Rs 36.77 crore for the quarter ended Mar 2018. But aided by favourable product mix, the operating profit margin (OPM) leaped by 780 bps to 22.9% and thus the operating profit jumped by 61% to Rs 8.42 crore. Facilitated further by higher other income and lower depreciation as proportion to operating profit, the PBT was up by 67% to Rs 7.74 crore. Eventually the PAT was up by 52% to Rs 5.72 crore moderated by higher taxation. But with Rs 1.82 crore swing in other comprehensive income to Rs 1.14 crore, the growth at total comprehensive income was 123% to Rs 6.86 crore.
- OPM expanded by strong 780 bps largely due to lower material and other expenses. The staff cost as proportion to sales net of stocks was up by 120 bps to 18.2%. But with material cost down by 590 bps to 30.7% and the other expenses down by 230 bps to 28.8%, the increase in staff cost was more than offset leading to OPM expansion. OPM expansion was largely due to product mix and cost rationalization measures introduced during the quarter.
- The other income was up by 11% to Rs 2.12 crore. The interest was higher at Rs 0.15 crore compared to nil in the corresponding previous period. The depreciation stands higher by 6% to Rs 2.65 crore. But depreciation as proportion to OP stood lower at 31.5% compared to 48% in the corresponding previous period. Thus the PBT was up by 52% to Rs 5.72 crore.
- The current tax was up by 132% to Rs 2.02 crore and the tax rate was up at 26.1% compared to 18.8% in corresponding previous period. Thus the growth at PAT moderated and stood at 52% to Rs 5.72 crore.
Consolidated sales net of GST/excise was up by 7% to Rs 40.38 crore. Facilitated by 690 bps expansion in OPM, the operating profit was up by 58% to Rs 8.82 crore. After accounting for higher OI, higher interest and depreciation, the PBT was up by 99% to Rs 7.07 crore. With taxation stand higher by 126% to Rs 2.17 crore, the PAT was up by 88% to Rs 4.90 crore. With other operating income stand higher at Rs 2.15 crore compared to an expense of Rs 0.92 crore, the net profit jumped up by 320% to Rs 7.05 crore.
Yearly performance
Standalone sale for the period was flat at Rs 129.42 crore and with OPM expand by 70 bps to 17.5% the operating profit was up by 4% to Rs 22.60 crore. The PAT was eventually higher by 5% to Rs 12.30 crore gained largely by higher other income.
Consolidated sale for the period was flat at Rs 146.68 crore and with 70 bps expansion in OPM the operating profit was up by 4% to Rs 26.12 crore. Eventually the PAT was up by 9% to Rs 13.13 crore.
Dividend
The company to pay a final dividend of Rs.15/- per equity share of face value of Rs.10/- each (150%) subject to the approval of the shareholders in the Annual General Meeting to be held on July 24, 2018. Having paid interim dividend of Rs 10 per share of Rs 10 face value earlier the total dividend for fiscal 2017-18 is Rs 25 per equity share of Rs 10 face value.
The stock hovers around Rs 3342.
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