Jindal Steel&Power

capital market | Mumbai |

Higher Depreciation and Finance cost continues to impact performance

JSPL reported loss at PBT of Rs 505.54 crore for Q1FY'16 compared to profit of Rs 516.82 crore in Q1FY'15 while net loss of the company was Rs 339.26 crore compared to profit of Rs 418.13 crore. Consolidated PBT and PAT of JSPL continue to be impacted due to higher Depreciation (Rs. 747 crore) and Finance cost of (Rs 852 crore).

In Q1 FY16, Steel production grew by 37% y-o-y. This was possible due to enhanced capacity utilization of Angul and Oman Steel plants. JSPL sold 1.1 MT of steel in Q1 FY 16 thus registering a growth of 39 % y-o-y. In spite of higher sales volumes, turnover of JSPL standalone declined by 6 % y-o-y from 3324 crore to Rs. 3134 crore due to decline in Net Sales Realization (NSR). NSR continues to be under pressure due to unabated import of steel from China, Korea and other countries.

JSPL standalone EBITDA on a y-o-y basis decreased from 1192 Cr to 710 Cr due to higher raw material cost and declining NSR. However, Standalone EBITDA compared to Q4 FY15 to Q1 FY16 increased by 14% from 622 crore to Rs.710 crore and increased by 29% on a consolidated basis from 790 crore to 1018 crore on account of better product mix, enhanced operational efficiency and robust performance in overseas operations (Oman and Australia).

Consolidated Quarterly Performance

The consolidated income from operationsdecreased 6% to Rs 4426.32 crore in Q1FY'16 compared to Q1FY'15 asIron and steel revenues fell by 3% to Rs 3724.07 crore and Power sales were upby 3% to Rs 1262.91 crore. The sales of others were down 33% to Rs 52.52 crore. The OPM decreased 1180 bps to 23% as power and fuel expenses as a percentage of adjusted net sales rose 830 bps to 17.9% along with employee benefit expenses which were up by 80 bps to 6.1% and cost of material consumed increased 760 bps to 37.5% limited by 90 bps fall in purchase of stock in trade tonil, 140 bps decrease in stores and spares consumed to 8.7% and 110 bps fall in other expenses to 15.1%.

Thus the operating profit fell by 38% to Rs 1017.64 crore. Other income was Rs 74.96 crore compared to Rs 90.41 crore in the corresponding previous year quarter while interest cost rose 59% to Rs 851.58 crore. Depreciation increased 12% to Rs 746.56 crore. PBT was loss of Rs 505.54 crore compared to profit of Rs 516.82 crore.

Considering tax writeback, minority interest and share of profit/loss of associates' net loss of the company was Rs 339.26 crore compared to profit of Rs 418.13 crore.

Consolidated year ended Performance

The consolidated income from operations increased 1% to Rs 19400.67 crore. The OPM decreased470 bps to 33.7% resulting into 5% decrease in operating profit to Rs 5483.46 crore. Other income rose 244% to Rs 225.6 crore while interest cost rose 74% to Rs 2607.34 crore. Depreciation increased 49% to Rs 2732.83 crore. PBT before EO fell 85% to Rs 368.89crore.The company reported an EO expense of Rs 1911.64 crore in FY'15 compared to nil in the corresponding previous year. PBT after EO was loss of Rs 1542.75 crore. Considering tax writeback, minority interest and share of profit/loss of associates' net loss of the company was Rs 1278.12 crore compared to profit of Rs 1910.36 crore.

The scrip is currently trading at Rs 68

Jindal Steel and Power: Consolidated Results

 

Particulars1506 (3)1406 (3)Var (%)1503 (12)1403 (12)Var (%)
Income from Operations4426.324687.33-619400.6719286.311
OPM(%)23.034.833.738.4
OP1017.641628.98-385483.465,776.40-5
OI74.9690.41-17225.665.63244
PBIDT1092.61719.39-365709.065842.03-2
Interest851.58535.45592607.341500.8274
PBDT241.021183.94-803101.724341.21-29
Depreciation746.56667.12122732.831829.249
PBT before EO-505.54516.82PL368.892512.01-85
EO001911.640
PBT after EO-505.54516.82PL-1542.752512.01-161
Tax-150.06115.24LP-88.16618.21-114
PAT-355.48401.58PL-1454.591893.80-177
Minority Interest13.6713.29173.8414.01
Share of Profit/Loss of Associates 2.553.262.632.553
Net profit -339.26418.13PL-1278.121910.36-167
EPS(Rs)*18.320.9
* Annualized on current equity of Rs 91.49 crore; Face Value of Rs 1
Figures in Rs crore
Var(%) exceeding 999 has been truncated to 999
LP : Loss to profit; PL : Profit to loss
EO: Extraordinary item
EPS is calculated after excluding EO and relevant tax
Source : Capitaline Corporate Database

Jindal Steel and Power: Consolidated Segment wise Results

 

Particulars1506 (3)1406 (3)% of totalVar (%)1503 (12)1403 (12)% of totalVar (%)
Revenue:
Iron and Steel3724.073828.0974-315631.2515996.372-2
Power1262.911229.142535701.344203.252636
Others52.5278.001-33331.41743.152-55
Total5039.505135.23100-221664.0020942.701003
Less: Inter Segment Revenues613.18447.90372263.331656.3937
Net Revenue from operation4426.324687.33-619400.6719286.311
PBIT:
Iron and Steel220.56705.5537-692377.223320.9857-28
Power398.66642.0866-382839.641987.716843
Others-19.12-229.23-3-92-1023.24-485.84-24111
Total600.101118.40100-464193.624822.85100-13
Capital Employed:
Iron and Steel34,410.1021701.381695933,244.9321036.6715858
Power16,897.3014701.63831515,556.9015123.03743
Others4,127.016136.6020-335,919.626209.7228-5
Unallocated-35,024.18-19509.5880-33,679.38-19758.88
Total Capital Employed20410.2323030.03100-1121042.0722610.54100-7
Figures in Rs crore
Var (%) exceeding 999 has been truncated to 999
Source: Capitaline Corporate Database

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