AIA Engineering reported 25% growth in its consolidated sales for the quarter ended June 2018 to Rs 715.23 crore. But a 100 bps contraction in operating profit margin to 21.8% saw the growth at operating profit restricted at 20% to Rs 155.58 crore. Though interest stood higher the other income was higher and depreciation was lower and thus the PBT was up by 22% to Rs 157.37 crore. But hit by higher taxation, the growth at PAT was 18% to Rs 104.81 crore. After accounting for higher non controlling interest and higher other comprehensive income (net of tax) the total comprehensive income was up by 30% to Rs 116.65 crore.
- Operating income excluding other operating income and net of excise/GST was up by 25% to Rs 690.94 crore. Higher sales is largely driven by both volume and realisation growth. While sales volume for the quarter was higher by 13% to 64211 Mt the sales realisation per MT was up by 10% to Rs 107605.24. The production volume for the quarter was higher by 23% to Rs 69843 MT.
- Other operating income was up by 61% to Rs 24.29 crore driven by higher export benefits and higher dividend income that is partially offset by lower forex gain. Thus the total operating income was up by 25% to Rs 715.23 crore.
- A 100 bps contraction in OPM to 21.8% was largely due to higher material cost and OE. Material cost as proportion to sales (net of excise and stocks) was up by 230 bps to 43.8%. Similarly the OE was up by marginal 20 bps to 31.8%. However the staff cost was lower by 70 bps (to 4.0%). Thus hit by lower OPM, the operating profit was up by 20% to Rs 155.58 crore.
- Other income was up by 9% to Rs 20.17 crore. The interest cost up by 31% to Rs 1.83 crore and the depreciation was down by 7% to Rs 16.55 crore. Thus the PBT was down by 22% to Rs 157.37 crore.
- Taxation was up by 30% to Rs 52.55 crore and thus the growth at PAT restricted to 18% to Rs 104.81 crore. Non-controlling interest was a share of loss of Rs 0.23 crore compared to a profit of RS 0.21 crore and thus the net profit after non-controlling interest was Rs 105.04 crore, a growth of 19%. Other comprehensive income net of tax was an income of Rs 11.61 crore compared to an income of Rs 0.93 crore. Thus gained the total comprehensive income was up by 30% to Rs 116.65 crore.
Other developments
Order book as at 1st July 2018 stood at Rs 835 crore.
The company has approved the Technical Collaboration Agreement with EE Mill Solutions LLP, USA (EEMS). EEMS has special knowledge of optimizing energy efficiency and output of grinding equipment ("Know How") like AG/SAG/Ball Mills in wet & dry grinding industries through re-designing of mill internals viz. Head & shell liners, grate liners, pulp lifters ("the products"). The company proposed to set up a dedicated plant for manufacturing the above products.
GIDC Kerala, Phase-II Greenfield expected to be commissioned in two phases. First phase will add 50,000 TPA capacity in F.Y. 201819 while Second phase will add another 50,000 TPA capacity in FY2019-20; taking installed capacity to 4,40,000 TPA.
The company has planned capex of Rs. 250 crore for manufacturing mining mill optimization products which shall be commissioned in FY2019-2020. Further, the company has planned to set up manufacturing plant of Mining Liner with estimated capex of Rs. 250 crore which will add liner capacity of 50,000 MT per year & to be commissioned in FY2019-2020.
Capex incurred till Q1-FY 2019 was Rs 40 crore. Total capital outlay for Grinding Media, Mill Liners and Wind Turbine will be Rs 800 crore in which Rs 500 crore during FY2018-19 & Rs 300 crore during FY2019-20.
Incremental volume growth in Mining estimated to be in the range of 40,000-50,000 MT per year from FY 2018-19 onwards.
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