• The value of production gross of excise for the quarter was higher by 6% to Rs 114.11 crore even as the operating income was up by 16% to Rs 115.14 crore. Sale for the quarter was 0.9% higher than value of production. However the sale of corresponding previous period was 7.6% lower than its respective value of production. Thus the strong growth came on weak base.
  
• Upside in revenue for the period was largely due to strong growth in revenue of wires & cables, building products and energy management with the revenue from industrial switchgear stand lower. Contribution of wires and cables stood increased to 55% for the quarter compared to 48% in corresponding previous period. Similarly the share of building products too increased to 5% from 4% in corresponding previous period. However the share of industrial switch gear was down to 38% compared to 46% in corresponding previous period. Thus the sale of industrial switchgear business was down by 5% to Rs 43.64 crore.
  
• Operating profit margin contracted by 220 bps to 9.1% given change in revenue mix with increased contribution to top-line from low margin wires and cables business. Material cost as proportion to sales net of stocks and excise was up by 20 bps to 74.4%. But the staff cost and OE too was higher by 10 bps (to 4.5%) and 100 bps (to 11%) respectively.
  
• Other income jumped by 173% to Rs 2.01 crore. The interest cost and depreciation was higher by 19% (to Rs 3.98 crore) and 15% (to Rs 2.67 crore). Thus the PBT was down by 7% to Rs 5.85 crore.

• Taxation in absolute terms was down by 11% to Rs 1.78 crore. And the tax rate stood lower at 30.5% compared to 31.6% in corresponding previous quarter. Thus the fall at PAT was 6% to Rs 4.07 crore.
  
• Other comprehensive expense was Rs 0.02 crore for the quarter compared to an income of Rs 2.12 crore in the corresponding previous period. Thus the total comprehensive income was down by 37% to Rs 4.05 crore.

Management comment

D Rajesh Kumar, Joint Managing Director of the company commenting on the results said, ͞We have been able to showcase a healthy growth of over 16% this quarter despite the numerous macro-economic headwinds. Although we witnessed some teething problems with implementation of the very ambitious GST regime, we are confident that it will have very positive impact in the long term. Other than a slight decline in our Industrial Switchgear segment, all other business segments of Wires & Cables, Building Segment and Energy Management have shown robust growth. The market conditions in India as well as USA and Europe continue being very challenging, despite this we have been able to sustain and achieve this growth because of our long term association with large OEM's. Looking ahead, we expect to see a pickup in demand especially because of our association with large and reputed companies like GE, Schneider, Honeywell, ABB & Siemens. We are confident that with our products of international standards, consistency in quality, timely delivery and some revival in the industry we will be able to achieve much healthier growth. We believe streamlining of GST will also prove to be advantageous to organised players like Salzer. In our Energy Management Business revenues have been able to book revenues from the recently implemented EESL project apart from the Operations & Maintenance of the earlier project. This business has a higher margin as compared to other business segments and will continue to give us Operations & Maintenance revenues in the coming quarters. Going forward, we will continue to focus on adding new, niche and high margin products, enter new geographies and offer total and customised electrical solutions to our existing and new customers. To aid to this we are constantly on the lookout for any new opportunities for technical associations to strengthen the base for our product offerings.͟

The stock hovers around Rs 181.95.