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Numeric Power Systems reported faded performance for the quarter ended March 2010. Net profit declined by 12% to Rs 9.08 crore on marginal growth in net sales by 2% to Rs 115.78 crore. The fall in profits is mainly due to contraction in margins by 430 bps to 10.0% and increase in the depreciation by 22% to Rs 11.70 crore. PBT declined by 22% to Rs 11.70 crore. Thanks to sharp decline in the effective tax rate by 920 bps to 22.4%, which restricted degrowth in net profit to 12%.
On consolidated basis, sales for the year ended March 2010 increased marginally by 4% to Rs 460.23 crore and profits declined by 1% to Rs 37.93 crore.
Standalone Quarterly Performance
Net sales increased by only 2% to Rs 115.78 crore for the quarter ended March 2010. Operating profit margins eroded by 430 bps to 10.0% resulting operating profit to decline by 28% to Rs 11.59 crore. The dip in the margins is primarily due to sharp increase in the other expenditure also increased by 260 bps to 12.8%, as percentage to sales, net of stock adjustment. Consumption cost declined by 280 bps to 70.2%. With more than doubling (up 111%) in other income to Rs 2.34 crore and interest cost declined by 24% to Rs 0.95 crore limited degrowth in PBDT to 19% at Rs 12.98 crore. Thanks to dip in the effective tax rate by 920 bps to 22.4% further restricted degrowth in net profit to 12% at Rs 9.08 crore.
Standalone Yearly Performance
For the year ended March 2010, the net sales increased by 7% to Rs 437.83 crore. Operating profit margins expanded by 50 bps to 11.3% resulting operating profit to increase by 12% to Rs 49.51 crore. Other income rose by 57% to Rs 7.76 crore and decline in the interest cost by 32% to Rs 3.39 crore led PBT before EO to increase by 22% to Rs 49.14 crore. Nil EO income compared to Rs 6.44 crore in the corresponding previous period on the account of gain on transfer of share to joint ventures restricted PBT growth to 5% at Rs 49.14 crore. Dip in the effective tax rate by 350 bps to 25.1% lifted net profit to increase by 10% at Rs 36.79 crore.
Consolidated Yearly Performance
The net sales for the year ended March 2010 on consolidated basis increased by 4% to Rs 460.23 crore. Operating profit margins remains flat at 11.1% leading operating profit to increase by 4% to Rs 51.21 crore. Other income increased by 47% to Rs 7.55 crore and interest cost fell by 33% to Rs 3.53 crore lifted PBT before EO to increase by 11% to Rs 50.40 crore. Nil EO income compared to Rs 6.99 crore in the corresponding previous period on the account of gain on transfer of share to joint ventures led PBT to de-grow by 4% at Rs 50.40 crore. Dip in the effective tax rate by 200 bps to 24.7% limited degrowth in net profit to 1% at Rs 37.93 crore.
Other information
The Board of Directors have recommended an equity dividend of Rs 3 per share or 30% for the year ended March 31 2010 on the capital after issue of bonus share in the proportion of 1 new equity shares of Rs 10 each for every 1 existing equity share of Rs 10 each of the company.
The promoter share holding remains unchanged at 63.19% as on 31st March 2010 as against 31st December 2009.
Valuation
The scrip hovers around Rs 330.30 on BSE. The EPS on consolidated basis for the year ended March 2010 is Rs 37.6 and PE stands at 8.8 times.
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