Top line of the company reported dip by 51% to Rs 268.07 crore. OPM was down to 13.5% from 21.2% in the corresponding previous quarter and thus led operating profits to decline by 69%. This de growth was carried down to the bottom line which was seen at Rs 13.30 crore (down by 77%).

Lakshmi Machine Works (LMW) is a leading manufacturer of textile machinery, producing the entire range of spinning machinery and is one among the three in the world. Out of India's total installation of 39 million spindles, a significant 20.10 million spindles have been supplied by LMW.

Performance for the Quarter ended December 08

The top line for the quarter ended December 08 has clocked a de growth of 51% to Rs 268.07 crore. Growth in the textile machinery segment was hampered by the poor environment prevailing in the textile industry. This segment, which contributes major pie of the total revenues (86%), has fallen by 54%. Further increase in the all the cost heads as % to sales added to drive the dip in OPM to13.5% from 21.2% in the corresponding previous quarter. At the segment level, the segment margins of textile machinery have eroded by whooping 1320 bps to 2.8% on the back of dip in segment revenues. And the segment margins of Machine tool and Foundry segment was flat at 4.1%, on the back of dip in sales by 14%. This segment profits fell by 13% to Rs 1.55 crore (19% of total). On the other hand segment profit of Textile Machinery segment fell by 92% to Rs 6.49 crore (81% of the total). Thus the Profits at operating level were thus down by 69% to Rs 36.14 crore.

Further, other income zoomed by 187% to Rs 18.71 crore, and depreciation cost marginally increased by 5% to Rs 34.34 crore resulting, PBT down by 77% to Rs 20.51 crore. As the effective tax rate increased by 60 bps to 35.2%, Net profit looked dull (down by 77%) to Rs 13.30 crore.

Performance for the Nine months ended December 08

The company has registered fall in its net sales by 27% to Rs 1187.68 crore, on the back of dip in sales of its textile machinery segment and Machine tool segment for the nine months ended December 08. With increase in cost heads as % of sales, OPM was under pressure and fell by 240 bps, leading Operating profit down by 36% to Rs 214.06 crore. The other income improved by 45% to Rs 37.07 crore, depreciation increased by 24% to Rs 99.28 crore and pushed PBT further down by 45% to Rs 151.86 crore. With increase in taxation by 50 bps to 34.9%, Net Profit was down by 46% to Rs 98.91 crore.

Other Information

• The scrip is traded at Rs 518.52 as on 28 January 09.
• The promoter's percentage of share holding for the quarter ended December 08 has increased to 25.82% as against 25.27% in the quarter ended December 07.