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Kirloskar Pnemautic, a leading player in compressed air, air-conditioning & refrigeration and hydraulic power transmission reported 48% fall in net profit to Rs 7.97 crore on the back of dip in sales by 25% to Rs 97.71 crore coupled with the cost pressures for the quarter ended December 2010. The fall in sales mainly driven by degrowth in compression systems business (84% of net sales) by 29% to Rs 82.49 crore. Operating profit margins contracted by 550 basis points to 12.7% resulting in operating profit to decrease by 48% to Rs 12.45 crore. Other income rose two fold to Rs 2.02 crore compared to the corresponding quarter in previous period.
Quarterly Performance:
Kirloskar Pnemautic net sales decreased by 25% to Rs 97.71 crore for the quarter ended December 2010. The fall in sales mainly driven by degrowth in compression systems business (84% of net sales) by 29% to Rs 82.49 crore. Interestingly, its transmission product business (16% of net sales) increased by 3% to Rs 15.22 crore. Operating profit margins contracted by whopping 550 basis points to 12.7% on the back of increase in consumption cost by 470 basis points as percentage to sales and net of stock adjustments. In addition, employee cost increased by 230 basis points and other expenditure by 160 basis points. Thus, operating profit decreased by 48% to Rs 12.45 crore. Other income rise by two fold to Rs 2.02 crore compared to the corresponding quarter in previous period.
Compression Systems business margins contracted by 260 basis points to 20.9% resulting PBIT to decrease by the 37% to Rs 17.24 crore during the quarter ended December 2010.
During the quarter, Interest increased by 20% to Rs 0.6 crore and depreciation by 22% to Rs 2.24 crore resulting PBT to decrease by 48% to Rs 11.63 crore. Decrease in tax by 49% to Rs 3.66 crore restricted the further fall in net profit resulting it to decrease by 48% to Rs 7.97 crore.
Nine Months Performance:
For the nine months ended December 2010, net sales increased by 4% to Rs 304.47 crore. Operating profit margins contracted by 310 basis points to 10.5% to resulting operating profit to decrease by 20% to Rs 32.01 crore. Other income increased by 69% to Rs 5.96 crore. With increase in interest by 4% to Rs 1.69 crore and depreciation by 25% to Rs 6.5 crore, PBT was down by 19% to Rs 29.78 crore. Decrease in tax by 18% to Rs 10.01 crore resulted PAT to decrease by 19% to Rs 19.77 crore. With Prior period adjustments (credit) Rs 0.66 crore compared to nil adjustments in corresponding previous period resulting net profit to decrease by 16% to Rs 20.43 crore.
Other Information:
- The Scrip is closed on BSE at Rs 499, down by 0.2% on 19th January 2010.
- The Scrip is currently trading at Rs 499 on BSE, which is 24 times of 9 months annualized EPS.
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