|
For the quarter ended 31st March 2006, Electrosteel Castings, India’s largest ductile Iron pipe manufacturer reported a fall in net sales by 5% to Rs 277.99 crore. However, the operating profit grew by 35% to Rs 40.86 crore aided by increase in operating margins by 440 bps. The resultant PAT for the quarter ended March 2006 rose by 81% to Rs 30.44 crore.
For the financial year ended 31st March 2006, the company reported a marginal rise of 7% in the topline to Rs 955.69 crore, a fall of 7% in the operating profits to Rs 116.10 crore resulting to a drop in the PAT by 14% to Rs 76.44 crore.
Quarterly results
For the quarter ended March 2006, sales registered a drop of 5% to Rs 277.99 crore (Rs 292.07 crore corresponding quarter). The operating margins improved by 440 bps to 14.7% (10.3% corresponding quarter). The Raw Material consumed as a % of sales (net of stock adjustment) increased by 100 bps to 41%. However, there was a fall in purchase for resale to 6% of sales (net of stock adjustments) against 18% in the corresponding quarter last year. This might have resulted to the rise in operating margins. The employee cost remained unchanged at 5% of sales (net of stock adjustments). Power & Fuel, stores & spares consumption, Job charges & other expenses rose as a % of sales (net of stock adjustments) by 100 bps, 300 bps, 100 bps & 200 bps to 6%, 7%, 5% & 14% respectively. As a result the operating profit grew by 35% to Rs 40.86 crore (Rs 30.22 crore corresponding quarter).
Other income rose by 161% to Rs 15.82 crore (Rs 6.05 crore corresponding quarter) mainly due to benefits availed under the Target Plus Scheme of Government of India for incremental exports of Rs 16 crore. Interest expense & Depreciation cost increased by 100 bps each to Rs 7.22 crore (Rs 1.08 crore corresponding quarter) & Rs 7.62 crore (Rs 7.56 crore corresponding quarter). The PBT excluding EO grew by 94% to Rs 41.84 crore (Rs 21.54 crore corresponding quarter). Provision for current tax was also up 68% to 9.75 crore against Rs 5.80 crore in the corresponding quarter. As a result the PAT stood at Rs 30.44 crore (Rs 16.79 corresponding quarter) up by 81%.
Annual Results
For the year ended March 2006, the company registered a rose by 7% to Rs 955.69 crore (Rs 890.37 crore previous year). The operating margins dropped by 190 bps to 12.1% (14% previous year). The Raw Material consumed as a % of sales (net of stock adjustment) decreased by 300 bps to 41%. However, there was a rise in purchase for resale to 14% of sales (net of stock adjustments) against 10% in the previous year. The employee cost, power & fuel cost & other expenditure remained unchanged at 5%, 6% & 12% of sales (net of stock adjustments) respectively. Stores & spares consumption rose by 100 bps to 6% of sales (net of stock adjustments) & Job charges dropped by 100 bps to 3% of sales (net of stock adjustments). As a result the operating profit decreased by 7% to Rs 116.10 crore (Rs 124.79 crore previous year).
Other income was rose by 18% to Rs 46 crore (Rs 39.02 crore previous year). Interest expense increased by 22% to Rs 25.67 crore against Rs 21 crore in the previous year. Depreciation cost rose by 13% to Rs 28.56 crore (Rs 25.18 crore previous year). The PBT excluding EO fell by 8% to Rs 107.87 crore (Rs 117.63 crore previous year). Provision for current tax decreased 20% to 30 crore against Rs 37.40 crore in the previous year. As a result the PAT stood at Rs 76.44 crore down 14%.
The EPS for the year ended 31st March 2006 stood at Rs 36.80 for an equity of Rs 20.76 crore of face value Rs 10 each. The board recommended a 125% dividend of Rs 12.50 per share consistent with last year.
Recent Development
Electrosteel Castings has commissioned its 12MW Haldia Power Plant in the quarter & commercial production started effective from 20th March 2006. It has also received clearance from the Pollution Control Board for the new 850 tonne per day sintering plant. The project at the plant in Khardah for increasing the liquid metal availability from the blast furnace, which entails an investment of Rs 66 crore will be completed within the next 12 to 15 months.
The company has decided to issue foreign currency convertible bonds (FCCBs) for raising $75 million (approximately Rs 332 crore) to meet the aggregate capital expenditure for the new projects including the proposed coal mining project in the Jharia belt. It is expected to be completed by the middle of next month. The coal-mining project will not commence before September 2006, as some formalities including procurement of mining lease are still pending.
|