Neyveli Lignite

For the quarter ended December 2011, Neyveli Lignite reported 20% growth in total Income to Rs 1045.99 crore The lignite mining sales increased by 22% (46% of total revenues) while power generation sales grew 16% contributing the rest of the revenues.

OPM jumped by 900 basis points to 21.8% due to fall in employee costs as well as consumption costs which led to a strong 105% increase in operating profits to Rs 227.52 crore.

Net Profit too grew a strong 93% to Rs 184.94 crore on the back of lower increase in interest costs, decline in depreciation charges despite rise in effective tax rate.

Quarterly Analysis

For the quarter ended December 2011, revenues grew 20% to Rs 1045.99 crore The lignite mining sales increased by 22% to Rs 836.41 crore (46% of total revenues) while power generation sales by 16% to Rs 988.91 crore.

OPM jumped by 900 basis points to 21.8% due to fall in employee cost by 450bps to 42.9% and consumption of stores, spares& fuel by 230 basis points to 14.9% of adjusted net sales. The other expenditure decreased (as a % of sales net of stock adjustment) by 250 bps to 19.9%.As a result, the Operating Profit rose by 105% to Rs 227.52 crore. The other income grew by only 3% to Rs 135.29 crore. Interest expense increased by 8% to Rs 28.34 crore. The depreciation expenses stood at Rs 90.99 crore which declined by 5%. The ensuing PBT stood at Rs 243.48 crore, a growth of 102%.

The tax expense increased by 141% to Rs 58.54 crore at effective tax rate of 24%, up 390bps and nil prior period item against income of Rs 7 lakh resulted in a 93% increase in PAT to Rs 184.94 crore.

Nine month Analysis

For the nine months ended December 2011, Neyveli Lignite reported 9% rise in total Income to Rs 3360.87 crore.

OPM (Operating Profit Margin) declined by 230 basis points to 28.5%. The subsequent Operating Profit for the period under review stood at Rs 956.17 crore which was 1% higher when compared with corresponding period last year. The Consumption of stores, spares and fuel fell (as a % of sales net of stock adjustment) by 40bps to 13% but Employee cost rose from 36.8% to 40.5% respectively. Other expenditure decreased from 19% to 18.2%. Other income increased by 32% to Rs 542.07 crore. The ensuing PBIDT was Rs 1498.24 crore which was 10% higher as compared to the corresponding previous quarter last year. Interest expense jumped by 28% to Rs 100.82 crore. The depreciation expenses stood at Rs 276.5 crore which was lower by 6% as compared to the corresponding previous quarter last year. PBT stood at Rs 1120.92 crore which was 14% higher when compared with corresponding period last year.

The tax expense stood at Rs 317.36 crore at effective tax rate of 28.3%, up 110bps and prior period income of Rs 2.56 crore against expense of Rs 4.57 crore resulted in a PAT of Rs 806.12 crore which was higher by 13% when compared with corresponding period last year.

Standalone FY11

It reported a 4% decline in total Income to Rs 3949.08 crore due to 6% fall in lignite mining sales and 5% fall in power generation sales.

The OPM increased by 136 basis points to 32.7% due to fall in employee cost by 600 bps to 35.4% of adjusted net sales. The Operating Profit remained stagnant at Rs 1289.63 crore. The Consumption of stores, spares and fuel and other expenditure cost increased (as a % of sales net of stock adjustment) by 70 bps to 12.9% and by 420 bps to 19.1% respectively

The other income increased by 62% to Rs 970.35 crore. The Interest expense increased stood at Rs 159.07 crore, up by 374%. The depreciation expenses stood at Rs 412.87 crore which was 63% higher. The ensuing PBT stood at Rs 1688.04 crore, a rise of 5%

The tax expense stood at Rs 386.22 crore (effective tax increased from 22.3% to 22.9%) resulting in a PAT of Rs 1298.33 crore, a rise of 4%.

Segment Quarterly Analysis

Lignite: the Lignite segment revenue increased by 22% to Rs 836.41 crore. The PBIT margins increased by 760 basis points to 16.7%. The subsequent PBIT stood at Rs 140.06 crore which was higher by 123%. This segment contributes 46% of the total income and 73% of the total PBIT

Power generation: the Power generation segment revenue increased by 16% to Rs 988.91 crore. The PBIT margins increased by 400 basis points to 5.2%. The subsequent PBIT stood at Rs 51.4 crore which was up by 388%. This segment contributes 54% of the total income and 27% of the total PBIT.

Segment FY11 Analysis

Lignite: the Lignite segment revenue decreased by 6% to Rs 2874.84 crore. The PBIT margins increased by 380 basis points to 32.9%. The subsequent PBIT stood at Rs 947.17 crore which was up by 6%. This segment contributes 43% of the total income and 66% of the total PBIT

Power generation: the Power generation segment revenue was down by 5% to Rs 3800.09 crore. The PBIT margins increased by 300 basis points to 12.7%. The subsequent PBIT stood at Rs 483.43 crore which was higher by 24%. This segment contributes 57% of the total income and 34% of the total PBIT

Promoters and Promoter group Holding

The promoters and promoter group share holding stood at 93.56%.

Pledged

There are nil shares pledged as on 31^st December 2011.

The shares of Neyveli Lignite were trading at around Rs 98 on 13^th February 2012 on BSE

Neyveli Lignite Standalone Results

Neyveli Lignite: Segment Results