Revenue zooms on growth in both Mining and Power segments- Net sales revenue of the GMDC inclined by 53% YoY to Rs 268.15 crore for the quarter ended September 2014. The growth in topline came on the back of strong growth in both Mining and Power segments sales.

The sales revenue from mining segment (contributes 69% of total revenue) rose by 51% to Rs 201.22 crore and power segment (contributes 31% of total revenue) increased by 60% to Rs 91.11 crore.

OPM shrinks to 27.4% - Operating profit margin (OPM) declined from 41.1% in Q2FY14 to 27.4% in Q2FY15. The sharp drop in OPM seems largely on account of higher over-burden removal expenses.

Overburden removal cost as % to sales net of stocks was higher by 1630 bps to 31.1%. Similarly the clean energy cess was up 240 bps to 5.6%, CSR expenses rose 280 bps to 2.8%, plant operation charges increased 60 bps to 5.5%, and Royalty cost rose 10 bps to 4.1%. However, Staff cost dropped 480 bps to 8.6%, mine closure expenses fell 260 bps to 5%, operation & other expenses slipped 190 bps to 6.3%, and power & fuel cost slid 20 bps to 3.2%. Thus, the operating profit growth slowed to 2% at Rs 73.48 crore.

During the quarter, the corporation has recognised one off mining expense of Rs 18.06 crore on account of Hard Strata at Tadkeshwar Project. Similarly, the corporation has also recognised one off O&M expense on account of change in performance parameter at Thermal Power Project for Rs 4.67 crore.

At segment level, PBIT of mining business fell 20% to Rs 43.31 crore. PBIT of power business business inclined to Rs 13.64 crore compared with LBIT of Rs 0.62 crore in the corresponding previous quarter. Margins of mining business were down to 21.5% from 40.5% in Q2FY14. Margin of power business inclined to 15% from -1.1% in Q2FY14.

With the 14% jump in other income to Rs 34.62 crore, the PBDIT grew by 5% to Rs 108.10 crore.

Bottonline jumps 19% on lower tax incidence - The interest cost was nil for the quarter as well as corresponding previous period. The depreciation was down 1% to Rs 30.36 crore owing to Companies Act 2013 coming into effect. Thus the PBT was up by 8% to Rs 77.74 crore. EO expenses for the quarter as well as corresponding previous quarter were nil. The taxation in absolute term declined by 12% to Rs 22.59 crore as the tax incidence was down660 bps at 29.1%. Thus the net profit was eventually higher by 19% to Rs 55.14 crore.

Half yearly performance

Sales of the company jumped 27% to Rs 692.03 crore for first half of the current fiscal year ended September 2014. Operating profit margin (OPM) fell by 610 bps to 39%, largely due to higher over-burden removal expenses. Overburden removal cost as % to sales net of stocks was higher by 850 bps to 27.9%. As a result, Operating Profit grew 10% to Rs 269.58 crore.

During the first half year ended September 2014, the corporation has paid Rs 9.86 crore toward VRS payments to employees. Also, as required under the Companies Act 2013, the corporation has provided for CSR expense of Rs 7.43 crore H1FY15. Total CSR required as per the Act during FY 2014-15 is Rs 14.86 crore.

With 1% drop in other income to Rs 66.16 crore and NIL interest cost, PBDT grew by 7% to Rs 335.73 crore. Further, with the flat depreciation allowance at Rs 59.70 crore owing to Companies Act 2013 coming into effect, the Profit Before Tax (PBT) rose by 9% to Rs 276.04 crore. The tax outgo grew slight 3% to Rs 90.35 crore, as the effective tax rate de-grew 190 bps to 32.7% during the period. Thus, the net profit rose 13% to Rs 185.69 crore.

Promoters Holding

As of 30^th September 2014, promoters holding remain unchanged at 74% from sequential previous quarter.

The scrip is currently trading at Rs 150.10 (14 November 2014) on the BSE.