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KSB Pumps, the Indian subsidiary of Klein Schanzlin & Becker (KSB), Germany has closed the fiscal on a mixed note. The standalone revenue of the company for the fourth quarter ended Dec 2009 was lower by 12% (to Rs 153.71 crore), but it's net profit was higher by 7% (to Rs 17.31 crore) on the back of strong operating performance where the operating profit expanded by sharp 630 basis points. Thus the operating profit was up by 23% (to Rs 33.95 crore) despite de-growth at revenue front. But for higher depreciation and tax incidence the growth at bottom-line would have been further steeper.
Quarterly performance
Standalone net sale for the quarter was down by 12% to Rs 153.71 crore on a high base. However the operating profit was higher by 23% to Rs 33.95 crore as the operating margin expands by 630 bps to 22.1%.
The segment sale of pumps business was lower by 7% to Rs 133.10 crore. Similarly the segment revenue of both valves and others has seen double digit de-growth of 37% (to Rs 20.06 crore) and 10% (to Rs 7.42 crore) respectively.
Despite fall in segment revenue the segment profit of Pumps business was higher by 37% (to Rs 25.16 crore) on the back of sharp 610 bps expansion in segment margin of pumps to 18.9%. But the segment margin of valves has crashed to 10.2% compared to 21.0% in corresponding previous period. With crash in margin over and above the sharp fall in revenue the segment profit of valves was lower by 69% to Rs 2.04 crore. The segment profit of others was higher by 80% to Rs 18 lakh with 120 bps expansion in segment margin to 2.4%.
Expansion in operating margin is largely on account of lower material cost. The material cost as a proportion to sales net of stocks was lower by 810 bps to 36.3% and staff cost was lower by 20 bps to 14.8%. However the other expense was higher by 150 bps to 25.5%. Even though the OE was higher that could not fully offset the gain in material cost and staff cost thereby facilitating expansion in OPM.
Other income was lower by 3% to Rs 1.58 crore. The interest cost was lower by 92% to Rs 0.07 crore and the depreciation was higher by 108% to Rs 7.83 crore. Thus the PBT was higher by 12% to Rs 27.63 crore.
Rise in depreciation cost on year on year basis is largely on account of commissioning of new plant at Sinnar near Nashik on Feb 12, 2009.
Taxation for the quarter was higher by 22% to Rs 10.32 crore. Thus limited, the net profit was finally higher by 7% to Rs 17.31 crore.
Yearly performance
Standalone sales were down by 6% to Rs 567.56 crore. Facilitated by 230 bps expansion in operating margin, the operating profit was up by 6% to Rs 115.19 crore. However the gains of higher other income (up 41% to Rs 7.75 crore) and lower interest cost (down 19% to Rs 1.82 crore) being more than offset by higher depreciation (up 56% to Rs 20.34 crore), the PBT closed at Rs 100.78 crore, a rise of just 2%.
The taxation was higher by 2% to Rs 34.60 crore. Thus spurred the net profit was higher by 2% to Rs 66.18 crore.
Consolidated sales for the fiscal were lower by 6% to Rs 568.97 crore. But with OPM expand by 230 bps to 20.5% the operating profit grew by 6% to Rs 116.52 crore. On the back of lower other income and higher depreciation cost the PBT was lower by 1% to Rs 99.12 crore. After providing for higher taxation (up 2% to Rs 35.08 crore) the net profit was lower by 2% to Rs 64.04 crore. After accounting for share of profit/ loss from associates the net profit was lower by 1% to Rs 70.79 crore.
The company to pay a final dividend @ 105% for the year ended Dec 31, 2009. This is in addition to an interim dividend @ 20% (or Rs 2 per share) already paid.
Promoter share holding increased to 66.80% as end of Dec 2009 compared to 66.58% as end of corresponding previous period, but unchanged compared to sequential previous quarter ended Sep 2009.
The stock hovers around Rs 470.10.
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