|
|
 | | | |
- close
- close
- close
- close
Punj Lloyd (BOM:532693) |
Suggest other news sources for this topic
WIKI ANALYSIS
Punj Lloyd is one of India’s leading EPC (engineering, construction and procurement) companies providing services to the energy and infrastructure sector. The company has presence in diverse businesses such as pipelines, tanks & terminals, process, power, offshore segment, civil construction & infrastructure services. In October 2006, it acquired 100% stake in Singapore based, Sembawang Engineers and Constructors (SEC) and its wholly owned UK subsidiary Simon Carves (SC). These acquisitions have helped the company to pre qualify for large sized orders in their respective segments. Punj Lloyd has also made inroads into the defense sector by signing a pact with Singapore Technologies Kinetics in FY08.
FY09 was a mixed year for the company. While it reported a strong 52% YoY increase in revenues, it recorded a loss at the net level. The company’s operating performance was largely impacted by a particular project that was with Simon Carves’ book before it was acquired. The company took a one-time charge of about Rs 4.7 bn on its books during the year.
A net loss at the consolidated level, substantial erosion in operating profits and lower order inflows together made FY09 as one of the most difficult years for Punj Lloyd. However, considering that most of its concerns are behind it, the company’s future prospects remain strong. In fact, concerns of the slow order inflow were also mitigated as the company reported an order intake of Rs 100 bn during the quarter ended June 2009. At the end of the quarter, Punj Lloyd had an order back log of Rs 279 bn, which stood at nearly 2.3 times its FY09 consolidated revenues. Further, the company has also been working on restructuring its subsidiaries by taking initiatives such as downsizing their employee strength apart from relocating their offices.
| Consolidated financial snapshot | ||||||
| (Rs m) | 4QFY08 | 4QFY09 | Change | FY08 | FY09 | Change |
|---|---|---|---|---|---|---|
| Net Sales | 23,463 | 32,173 | 37.10% | 77,525 | 119,120 | 53.70% |
| Expenditure | 20,981 | 32,958 | 57.10% | 71,122 | 116,028 | 63.10% |
| Operating profit (EBITDA) | 2,482 | (785) | ( ) | 6,403 | 3,093 | (51.70%) |
| Operating profit margin (%) | 10.60% | (2.40%) | 8.30% | 2.60% | ||
| Other income | (179) | 134 | ( ) | 815 | 745 | (8.60%) |
| Depreciation | 409 | 508 | 24.10% | 1,462 | 1,771 | 21.10% |
| Interest | 326 | 729 | 124.00% | 1,292 | 2,208 | 70.90% |
| Profit before tax | 1,568 | (1,888) | ( ) | 4,464 | (140) | ( ) |
| Extraordinary income/(expense) | ( ) | 22 | 371 | 154 | (58.60%) | |
| Tax | 374 | 667 | 78.30% | 1,235 | 2,260 | 83.00% |
| Profit after tax/(loss) | 1,194 | (2,534) | ( ) | 3,600 | (2,247) | ( ) |
| Share in profits/(losses) of associates | (17) | (82) | (17) | (68) | ||
| Minority interest | 0 | 59 | 1 | 62 | ||
| Net profit | 1,177 | (2,556) | ( ) | 3,584 | (2,253) | ( ) |
| Net profit margin (%) | 5.00% | (7.90%) | 4.60% | (1.90%) | ||
| No. of shares (m) | 303.5 | |||||
| Diluted earnings per share (Rs)*# | (7.4) | |||||
| P/E ratio (x)# | ( ) | |||||
- Adjusted for extraordinary items; # On a trailing 12-months basis.
Quarterly Result Analysis- Sept'09
Performance summary
- Consolidated sales grow by 5% YoY during 1HFY10; drop by 2% YoY during 2QFY10.
- Operating margins remain flat at 8.7% during the first six months of FY10. However, for 2QFY10, operating margins fall by 1.8% YoY.
- Net profits during 1HFY10 fall by 30% YoY. This is on the back of lower other income and higher interest and depreciation costs.
- Order backlog at the end of September 2009 stood at Rs 268 bn (2.3 times FY09 sales).
| Consolidated financial snapshot | ||||||
| (Rs m) | 2QFY09 | 2QFY10 | Change | 1HFY09 | 1HFY10 | Change |
|---|---|---|---|---|---|---|
| Net Sales | 29,261 | 28,764 | (1.70%) | 55,748 | 58,316 | 4.60% |
| Expenditure | 26,536 | 26,596 | 0.20% | 50,907 | 53,230 | 4.60% |
| Operating profit (EBITDA) | 2,724 | 2,168 | (20.40%) | 4,841 | 5,086 | 5.10% |
| Operating profit margin (%) | 9.30% | 7.50% | 8.70% | 8.70% | ||
| Other income | 280 | (43) | (115.30%) | 375 | 196 | (47.60%) |
| Depreciation | 439 | 514 | 17.10% | 830 | 1,055 | 27.00% |
| Interest | 490 | 796 | 62.30% | 859 | 1,539 | 79.30% |
| Profit before tax | 2,076 | 816 | (60.70%) | 3,526 | 2,688 | (23.80%) |
| Extraordinary income/(expense) | ( ) | ( ) | 204 | ( ) | ||
| Tax | 647 | 301 | (53.40%) | 1,177 | 923 | (21.60%) |
| Profit after tax/(loss) | 1,429 | 515 | (64.00%) | 2,553 | 1,765 | (30.90%) |
| Share in profits/(losses) of associates | 9 | 31 | 0 | 12 | ||
| Minority interest | 3 | (18) | 7 | 23 | ||
| Net profit | 1,441 | 529 | (63.30%) | 2,560 | 1,800 | (29.70%) |
| Net profit margin (%) | 4.90% | 1.80% | 4.60% | 3.10% | ||
| No. of shares (m) | 303.5 | 331.7 | ||||
| Diluted earnings per share (Rs)*# | (9.2) | |||||
| P/E ratio (x)# | NA | |||||
* Adjusted for extraordinary items; # On a trailing 12-months basis.
What has driven performance in 2QFY10?
- Punj Lloyd’s (PUNL) topline fell by 2% YoY during 2QFY10. This performance is attributable to its process and infrastructure segments, where sales fell by nearly 37% YoY. However, the company’s pipelines division grew by nearly 100% YoY.
- PUNL’s operating profits decreased by 20% YoY during the quarter. The operating margins contracted by 1.8% mainly on the back of higher raw material expenses (as a percentage of sales).
- On the back of a weak operating performance, lower other income and higher fixed charges of depreciation and interest as compared to 2QFY09, PUNL recorded a fall in its bottomline (down 63% YoY) during 2QFY10.
| |||||||
