GMM Pfaudler

Prolific growth continues

Jan 24, 2020 02:01 IST capital market

GMM Pfaudler registered 74% jump in consolidated net profit for the quarter ended Dec 2019 to Rs 21.05 crore. Strong jump in net was largely due to strong operating performance, where 19% growth in sales to Rs 155.97 crore was backed up by 370 bps expansion in OPM to 19.5% thereby leading to strong 46% leap in sales to Rs 30.43 crore as well as higher other income and lower tax.
  • The 19% growth in consolidated sales to Rs 155.97 crore was driven by strong double digit growth in sales of glass line equipment (GLE) as well as heavy engineering (HE) reflecting strong conversion of healthy opening order book. Segment revenue of GLE was up by 20% to Rs 91.14 crore (or 58% of sales). Similarly the segment revenue of Heavy Engineering (HE) was up by 53% to Rs 15.03 crore (or 10% of sales). The segment revenue of proprietary products (PP) was up by 9% to Rs 49.79 crore (or 32% of sales).
  • EBIT was up by 64% to Rs 30.62 crore with strong growth from GLE business. Segment profit of GLE business was up by 44% to Rs 20.12 crore driven by higher sales as well as 370 bps expansion in its segment margin to 22.1%. Similarly the segment profit of HE, albeit on a low base, jumped up by 209% to Rs 4.18 crore facilitated by higher sales as well as whopping 1410 bps expansion in segment margin to 27.8%. Likewise, facilitated by higher sales and 530 bps expansion in margin to 12.7%, the segment profit of PP was up by 87% to Rs 6.32 crore.
  • Other income stood higher at Rs 3.42 crore, a swing of Rs 3.58 crore. And thus the PBIDT was up by 64% to Rs 33.85 crore. With interest and depreciation up by 191% (to Rs 0.94 crore) and 96% (to Rs 5.86 crore) the PBT was up by just 56% to Rs 27.05 crore.
  • Taxation (net of deferred tax) for the period was higher by 14% to Rs 6.0 crore in absolute terms but the effective tax rate for the period was down at 22.2% compared to 30.4% in corresponding previous period. Thus gained by lower tax incidence, the PAT jumped up by 74% to Rs 21.05 crore.

The Group has completed acquisition of Industrial Mixing Solution Division (IMSD) of Sudarshan Chemical Industries Limited located at Pune on going concern basis in terms of definite agreement on April 12, 2019 for Rs. 272.27 million. Results and segment disclosures for the quarter ended December 31, 2019 include Industrial Mixing Solution Division starting from April 12, 2019, hence not comparable with previous periods.

Nine-month performance

Consolidated sale for the period was up by 26% to Rs 459.29 crore. With OPM expand by 360 bps to 19.3%; the operating profit was up by 55% to Rs 88.66 crore. However the growth at PBT moderated at 41% to Rs 75.86 crore hit by lower OI, higher interest and higher depreciation. Eventually the PAT was up by 60% to Rs 59.53 crore as taxation stand lower by 1% to Rs 16.33 crore.

Segment profit of GL was up by 48% (to Rs 57.11 crore) led by 30% growth in sales (to Rs 271.44 crore) and 250 bps expansion in segment margin to 21.3%. Similarly the segment profit of PP was up by 59% (to Rs 22.85 crore) as its segment sales was up by 21% (to Rs 146.31 crore) and segment margin expand by 370 bps to 15.6%. However the segment profit of HE was up by 14% to Rs 6.79 crore facilitated largely by 22% growth in sales to Rs 41.54 crore as its segment margin declined by 120 bps to 16.3%.

The Group has completed acquisition of Industrial Mixing Solution Division (IMSD) of Sudarshan Chemical Industries Limited located at Pune on going concern basis in terms of definite agreement on April 12, 2019 for Rs. 272.27 million. Results and segment disclosures for the nine month ended December 31, 2019 include Industrial Mixing Solution Division starting from April 12, 2019, hence not comparable with previous periods.

Management Comment

Commenting on the Companys performance for Q3FY20, Tarak Patel, Managing Director said We are pleased to report yet another quarter of strong performance with consolidated operating revenue growth of 19% and EBITDA growth of 46% over the same period in the previous year. Our order book continues to remain healthy on the back of strong demand from the Chemical and Pharmaceutical sectors. We will selectively add capacity looking at the robust demand environment. He further added We continue to innovate and improvise to enhance our performance and create differentiated value for our stakeholders. The Company has also laid out a five-year plan with an aim to take the Company to next level of sustainable growth.

Interim dividend

The Board of Directors have announced a third interim dividend Rs. 1/- per share for the current financial year 2019-20. The record date for the payment of the said dividend has been fixed on January 31, 2020.

GMM Pfaudler : Consolidated Results

 

1912 (3) 1812 (3) Var. (%) 1912 (9) 1812 (9) Var. (%) 1903 (12) 1803 (12) Var.(%)
Sales 155.97 131.40 19 459.29 363.52 26 502.64 405.70 24
OPM (%) 19.5 15.8 19.3 15.7 15.3 15.3
OP 30.43 20.82 46 88.66 57.17 55 76.97 62.08 24
Other inc. 3.42 -0.16 LP 5.03 6.00 -16 8.45 9.39 -10
PBIDT 33.85 20.66 64 93.69 63.17 48 85.42 71.47 20
Interest 0.94 0.32 191 2.59 0.84 209 1.17 1.03 14
PBDT 32.91 20.34 62 91.10 62.33 46 84.24 70.44 20
Dep. 5.86 2.98 96 15.25 8.52 79 10.97 9.79 12
PBT 27.05 17.35 56 75.86 53.81 41 73.27 60.65 21
Taxation 6.00 5.28 14 16.33 16.52 -1 22.69 17.97 26
PAT 21.05 12.07 74 59.53 37.29 60 50.58 42.68 19
EPS (Rs)* # # # # 34.6 29.2
* Annualized On Current Equity Of Rs 2.923 Crore. Face Value: Rs 2
# EPS is not annualised due to seasonality of business
Figures in Rs crore
Source: Capitaline Corporate Database

GMM Pfaudler: Segment Results

 

Segment 1912 (3) 1812 (3) Var. (%) % to total 1912 (9) 1812 (9) Var. (%) % to total 1903 (12) % to total
Sales
GlassLine Equipment 91.14 75.74 20 58 271.44 208.75 30 59 285.01 57
Heavy Engineering 15.03 9.85 53 10 41.54 33.94 22 9 55.34 11
Proprietary Products 49.79 45.82 9 32 146.31 120.83 21 32 162.29 32
Total Sales 155.97 131.40 19 100 459.29 363.52 26 100 502.64 100
Inter Segment Revenue
Net sales 155.97 131.40 459.29 363.52 26 502.64
PBIT
GlassLine Equipment 20.12 13.95 44 66 57.71 39.11 48 66 55.60 68
Heavy Engineering 4.18 1.35 209 14 6.79 5.97 14 8 6.42 8
Proprietary Products 6.32 3.38 87 21 22.85 14.36 59 26 19.80 24
Total PBIT 30.62 18.68 64 100 87.35 59.44 47 100 81.82 100
LESS: Interest expenes 0.94 0.32 191 2.59 0.84 209 1.17
Other income & unallocable expenses 2.63 1.01 161 8.90 4.79 86 7.38
PBT before EO 27.05 17.35 56 75.86 53.81 41 73.27
Profit from discontinued operations (auto anciliary)
PBT before profit from discontinued operations
Note: Figures in Rs crore

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