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Huhtamaki PPL net sales fell 9% to Rs 574.56 crore in Q1CY20 compared to Q1CY19. The company operating margins decreased 460 bps to 9.3% leading to 39% decrease in operating profits to Rs 53.34 crore. Notably in the corresponding previous quarter OPM was very high at 13.9%.
The acquisition of Mohan Mutha Polytech Private Limited, Sri City, Andhra Pradesh, India on slump sale basis was completed on January 10, 2020. Accordingly, the results of acquired business have been included in above results from January 10, 2020.
Consequent to the nationwide lockdown effective March 25, 2020, following the unprecedented COVID-19 pandemic, the Company's operations were scaled down in compliance with the applicable regulatory orders, resulting in lower revenue for the quarter ended March, 2020. Impact on future operations would to a large extent depend on how the pandemic develops and the resultant impact on business.
Other income decreased 78% to Rs 1.9 crore compared to Rs 8.77 crore. Interest cost decreased 8% to Rs 6.25 crore. Depreciation increased 15% to Rs 24.81 crore. PBT was down 64% to Rs 24.18 crore.
Tax provision decreased 76% to Rs 6.22 crore. PAT was down 57% to Rs 17.96 crore. Tax reversal for earlier period was Rs 9.35 crore compared to nil in the corresponding previous year period. Net profit fell 35% to Rs 27.31 crore.
Considering the need to conserve its financial resources during the current economic slowdown consequent to the COVID 19 pandemic, the Board of Directors revised its previous recommendation of payment of final dividend of Rs. 5/- per equity share for the year ended December 31, 2019 to Rs. 3/- per share (December 31, 2018 - Rs 3/- per share) . The same is subject to approval by the shareholders at the ensuing Annual General Meeting of the company.
Performance for year ended December 2019
For year ended December 2019, net sales rose 9% to Rs 2582.37 crore. The company operating margins increased 200 bps to 11.4%. As a result operating profits rose 31% to Rs 293.44 crore.
Other income rose 14% to Rs 16.2 crore. Interest cost rose 7% to Rs 31.13 crore. Depreciation rose 2% to Rs 86.93 crore. PBT before EO was up 55% to Rs 191.58 crore. The company had EO income of Rs 10 crore compared to EO expense of Rs 10 crore. PBT after EO was up 77% to Rs 201.58 crore.
Tax provision increased 10% to Rs 63.53 crore. PAT reported was up 147% to Rs 138.05 crore. Tax reversal for earlier period was Rs 21.07 crore compared tax provision of Rs 21.07 crore in the corresponding previous year period. Net profit rose 356% to Rs 159.12 crore.
The scrip is currently trading at Rs 199
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