Bharat Heavy Electricals (500103) Q4 02/03 earnings summary

Executive summary

• FY 2002-03 turnover reached a record Rs 74,822 million, up 2.68% YoY; PBT rose 21.06% to Rs 8,024 million, while PAT fell 5.00% to Rs 4,445 million, mainly due to additional prior-year income-tax provision.

• Orders booked rose 13.92% to Rs 112,270 million; year-end order book was ~Rs 158,000 million for execution in FY 2003-04 and beyond.

• Equipment worth Rs 1,249 million was not shipped due to the Iraq war, affecting turnover.

Financial highlights

• Value added increased 5.64% to Rs 32,475 million; proposed dividend remained 40%, or Rs 979 million, with Rs 125 million dividend tax provision.

• Net worth grew 11.56% to Rs 47,082 million; total assets rose 3.15% to Rs 95,879 million, while borrowings declined 20.25% to Rs 5,310 million.

• Cash and bank balances increased to Rs 13,209 million from Rs 4,766 million; net working capital, excluding cash and bank balances, declined Rs 5,899 million.

Outlook and guidance

• FY 2003-04 planned capital investment was Rs 1,803 million; the 10th Plan investment target was Rs 7,000 million, focused on modernization, quality, cost and new technologies.

• Strategic Plan 2007 prioritized core power, transmission, transportation and industrial businesses, plus EPC, O&M, after-sales services, renewable energy, oil-sector and water-management opportunities.

• R&D priorities included supercritical thermal plants, IGCC, advanced controls, hydro efficiency, transmission systems, simulators and specialized engineering software.