GE T&D India, one of the leading manufacturers of transmission and distribution equipments in the country has 14% growth in sales to Rs 993.30 crore. With operating profit margin stay flat at 9.3%, facilitated by higher sales, the operating profit was up by 14% to Rs 92.13 crore. Other income though stood higher restricting the growth at PBIDT to just 1% to Rs 115.91 crore, the lower interest and depreciation cost has powered the PBT up by 15% to Rs 80.13 crore. But with taxation stand higher by 30% to Rs 28.65 crore in absolute terms and tax rate stand increased to 35.8% up from 31.7% in corresponding previous peirod, the growth at PAT was restricted to 8% to Rs 51.48 crore. With Rs 1.85 crore swing in other comprehensive income to Rs 0.84 crore, the total comprehensive income was up by 12% to Rs 52.32 crore. But for lower OI and higher taxation the growth at bottomline would have been higher than reported.
- Sales were up by 14% to Rs 993.30 crore. Value of production for the quarter was down by 21% to Rs 1030.17 crore and the value of production was 3.7% higher than sales for the quarter compared to 1.9% lower than value of production in corresponding previous period. This reflects there is an inventory built up which will get liquidated in coming quarters.
- OPM for the quarter was flat at 9.3% as the rise in material cost was offset by lower staff and OE. Material cost as proportion to sales net of stocks was up by 590 bps to 67.4%, but the staff cost and OE was down by 190 bps and 350 bps respectively to 9.7% and 14%. With OPM stay flat facilitated largely by higher sales the operating profit was up by 14% to Rs 92.13 crore.
- The other income was down by 31% to Rs 23.78 crore. Thus the PBIDT was up by 1% to Rs 115.91 crore. The interest cost was down by 37% to Rs 14.28 crore. The depreciation was down by 6% to Rs 21.50 crore. Thus spurred by lower interest cost and depreciation as proportion to OP, the PBT was up by 15% to Rs 80.13 crore.
- The taxation net of deferred tax was up by 305 to Rs 28.65 crore and the tax rate was higher at 35.8% up from 31.7% in corresponding previous period. And thus the PAT was up by 8% to Rs 51.48 crore. The PPT for the quarter and corresponding previous period was nil. Thus the PAT after PPT was up by 8% to Rs 51.48 crore.
Half yearly results
Sales were up by 4% to Rs 2155.73 crore and with OPM stand increase by 210 bps to 11%, the operating profit was up by 27% to Rs 236.32 crore. Lower other income though restricted the growth at PBIDT to 6% (to Rs 279.31 crore) facilitated by lower interest and depreciation cost, the PBT was up by 24% to Rs 206.37 crore. With taxation up by 26% to Rs 72.84 crore, the PAT was up by 22% to Rs 133.53 crore.
Other developments
Revenue recognition - Effective 1 April 2018, the Company adopted Ind AS 115, "Revenue from Contracts with Customers" using the cumulative effect approach, as the transitional provision option available to the Company. The Company also reassessed the revenue recognition method in respect of measuring percentage of completion for applicable products/ services projects. The key changes in accounting policies included non-discounting of retention money as it is considered to ensure Company's obligation rather than provision of finance to the customer and change in method of measuring percentage of completion measured by segmented portions of the contract, i.e. Contract Milestones achieved to actual costs incurred. As a result, the cumulative effect of Rs 81.71 crore (net of tax impact Rs 42.41 crore) has been recognized as addition to retained earnings as at 1 April 2018. It is impracticable to determine the adjustments/ impact of the above changes on the comparatives and current period/ quarter results. Accordingly, the comparatives have not been retrospectively adjusted, i.e it is presented, as previously reported, under earlier revenue recognition standards.
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