LMW sequentially turns around to net profits in Q2

Lakshmi Machine Works (LMW) turned around to profits in the Sep-20 quarter from losses in the Jun-20 quarter.

Oct 26, 2020 05:10 IST India Infoline News Service

Cotton Spinning Machine
LMW India turned around to profits in the Sep-20 quarter from losses in the Jun-20 quarter. However, on a yoy basis, the net profits of the company fell by over 47%. The company also reported a minor operating loss in the Sep-20 quarter but other income saved the day for India’s largest textile machinery manufacturer.

The sales revenues for the Sep-20 quarter were marginally down by 3.9% at Rs396cr. While the sales more than doubled on a sequential basis, this cannot be taken as an indication as the Jun-20 quarter had taken a hit on account of COVID pandemic driven demand fall.
Financial highlights for Sep-20 compared yoy and sequentially

Particulars Sep-20 Quarter Growth (yoy) Growth (qoq)
Total Revenues Rs396.34cr -3.18% +134.84%
Operating Profit Rs-0.08cr Not Applicable Not Applicable
Net Profits Rs6.91cr -43.17% Not Applicable
Key Ratios Sep-20 Quarter Sep-19 Quarter Jun-20 Quarter
Diluted EPS Rs6.47 Rs11.39 Rs-20.24
Operating Margins -0.02% -1.27% -24.82%
Net Profit Margin 1.74% 2.97% -12.81%

Key takeaways from the Sep-20 quarter results

  • While the Jun-20 quarter may have been an exceptionally bad quarter due to the pandemic, the good news for the company is that its sales revenues have picked up back to the pre-COVID levels in the Sep-20 quarter.
  • For the Sep-20 first half of the fiscal, the net cash generated from operations was marginally higher at Rs62.4cr. However, that was more on account of the sharp fall in the tax liability of the company during the first half of the current fiscal

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