3M India

PAT up 42% on good operating show and lower tax

Nov 14, 2019 01:11 IST capital market

3M India has registered 4% growth in consolidated sales to Rs 763.53 crore for the quarter ended September 2019. Higher sales together with 310 bps expansion in operating profit margin powered the operating profit up by 27% to Rs 129.54 crore. The growth at PBT moderated to stand at 17% to Rs 125.64 crore hit by lower other income, higher interest and higher depreciation. But a 31% fall in tax provision to RS 25.63 crore, as the company availed lower corporate tax as per the recent ordinance, the PAT (of continuing operations) jumped up by 42% to Rs 100.01 crore.
  • Upside in revenue for the period was largely due to early double digit growth in revenue of healthcare and consumer business. The safety & Industrial (S&I) business of the company registered flat growth in revenue to Rs 285.87 crore (or 37% of total sales). The segment revenue of Transportation & Electronics (T&E), other major contributor to revenue, has registered a marginal 2% growth in revenue to Rs 245.61 crore (or 32% of sales). However the segment revenue of Healthcare and Consumer was up by 10% (to Rs 131.65 crore or 17% of total sales) and 14% (to Rs 92.74 crore or 12% of total sales). The segment revenue of others was up by 2% to Rs 7.66 crore.
  • The EBIT was up by 27% to Rs 115.76 crore and the upside is largely due to strong growth in profitability of both healthcare and consumer. The S&I segment despite flat growth in revenue have reported early double digit growth in segment profit, which grew by 12% to Rs 47.21 crore. This was largely due to 180 bps expansion in segment margin of S&I business to 16.5%. On the other hand despite margin rise in sales, hit by 60 bps drop in margin to 7.3%, the segment profit of T&E business was down by 6% to Rs 17.93 crore. Riding on strong early double digit growth in revenue backed by strong 680 bps expansion in segment margin, the segment profit of healthcare was up by sharp 66% to Rs 26.28 crore. Similarly facilitated by higher sales and 950 bps expansion in segment margin to 23.9%, the segment profit of consumer jumped up by 89% to Rs 22.16 crore.

Half yearly performance

Consolidated sales was up by 6% to Rs 1568.02 crore driven largely by growth in revenue of all the four core business segments of the company. The segment revenue of S&I was up by 4% to Rs 593.30 crore and that of T&E was up by 5% to Rs 529.89 crore. The segment revenue of healthcare and consumer was up by 8% and 11% respectively to Rs 261.28 crore and Rs 171.19 crore.

But with OPM contract by 30 bps to 17.6%, the operating profit was up by 4% to Rs 276.24 crore facilitated largely by higher sales. After accounting for lower other income, higher interest and higher depreciation, the PBT was flat at Rs 264.19 crore. But a 19% fall in taxation to Rs 74.05 crore saw the PAT up by 10% to Rs 190.14 crore.

The EBIT was up by 2% to Rs 247.55 crore as the two large segments of the company i.e. S&I and T&E register lower segment profit for the period. S&I registered 3% fall in segment profit to Rs 104.45 crore and the T&E registered 10% fall in segment profit to Rs 53.88 crore. Despite higher sales the fall in segment profit for both S&I and T&E business of the company is largely due to 120 bps and 170 bps erosion in their segment margin respectively to 17.6% and 10.2%. The segment profit of healthcare was up by 5% to Rs 48.58 crore riding largely on higher sales as it segment margin eroded by 70 bps to 18.6%. However riding on higher sales as well as 560 bps expansion in segment margin to 22.3%, the segment profit of consumer was up by 48% to Rs 38.21 crore.

3M India: Consolidated Results

 

1909 (3) 1809 (3) Var. (%) 1909 (6) 1809 (6) Var. (%) 1903 (12) 1803 (12) Var. (%)
Sales 763.53 736.42 4 1568.02 1482.43 6 3016.82 2734.19 10
OPM (%) 17.0 13.9 17.6 17.9 17.8 18.2
OP 129.54 102.06 27 276.24 265.35 4 535.59 498.61 7
Other inc. 10.67 16.93 -37 18.28 21.77 -16 36.83 44.79 -18
PBIDT 140.21 119.00 18 294.52 287.13 3 572.42 543.40 5
Interest 0.79 0.15 445 1.64 0.34 377 1.12 2.03 -45
PBDT 139.42 118.85 17 292.88 286.78 2 571.30 541.37 6
Dep. 13.78 11.19 23 28.69 22.21 29 43.76 43.51 1
PBT before EO 125.64 107.67 17 264.19 264.58 0 527.54 497.86 6
EO Income 0.00 0.00 0.00 0.00 0.00 0.00
PBT after EO 125.64 107.67 17 264.19 264.58 0 527.54 497.86 6
Taxation 25.63 37.38 -31 74.05 91.94 -19 184.39 174.56 6
PAT 100.01 70.29 42 190.14 172.64 10 343.15 323.30 6
Share of Profit/(Loss) from Associates 0.00 0.00 0.00 0.00 0.00 0.00
Net profit (continuing operations) 100.01 70.29 42 190.14 172.64 10 343.15 323.30 6
EPS (Rs)* # # # # 304.6 287.0
* EPS is on current equity of Rs 11.2651 crore, Face value of Rs 10
# EPS is not annualised due to seasonality of business
Figures in Rs crore
Source: Capitaline Corporate Database

3M India : Consolidated Segment results

 

Sales 1909 (3) 1809 (3) Var. (%) % to total 1909 (6) 1809 (6) Var. (%) % to total 1903 (12) % to total
Safety & Industrial 285.87 286.29 0 37 593.30 570.21 4 38 1176.84 39
Transportation & Electronics 245.61 241.10 2 32 529.89 504.49 5 34 1030.55 34
Healthcare 131.65 120.01 10 17 261.28 240.85 8 17 475.27 16
Consumer 92.74 81.51 14 12 171.19 154.14 11 11 303.49 10
Others 7.66 7.52 2 1 12.36 12.74 -3 1 30.67 1
Total Reportable Segment 763.53 736.42 4 100 1568.02 1482.43 6 100 3016.82 100
Less: Inter segment revenues
Net sales 763.53 736.42 4 1568.02 1482.43 6 3016.82
PBIT
Safety & Industrial 47.21 42.23 12 41 104.45 107.31 -3 42 243.13 49
Transportation & Electronics 17.93 19.11 -6 15 53.88 59.62 -10 22 106.98 22
Healthcare 26.28 15.79 66 23 48.58 46.40 5 20 79.43 16
Consumer 22.16 11.70 89 19 38.21 25.80 48 15 54.88 11
Others 2.19 2.04 7 2 2.44 4.02 -39 1 7.41 2
Total 115.76 90.88 27 100 247.55 243.15 2 100 491.83 100
Less: Interest 0.79 0.15 445 1.64 0.34 377 1.12
Add: Interest Income
Add: Other un-allcoable 10.67 16.93 -37 18.28 21.77 -16 36.83
PBT before Share of profit from JV 125.64 107.67 17 264.19 264.58 0 527.54
Add EO Income
Add:Profit from JV
PBT after Share of profit from JV
Figures in Rs crore
Source: Capitaline Corporate Database

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