Engineers India (ENGINERSIN) Q4 97/98 earnings summary

Executive summary

• FY1997-98 services turnover after Work-in-Progress adjustment was Rs.3,112 million; net profit reached Rs.732 million, with growth across business areas despite stronger competition and slower client investment.

• New business secured rose 15% YoY, supporting a comfortable order book; MOU targets were met at the “Excellent” rating level.

Financial highlights

• Income from services rendered was Rs.3,124 million vs Rs.2,745 million in FY1996-97; other income was Rs.414 million vs Rs.337 million.

• Expenditure including depreciation was Rs.2,384 million vs Rs.1,910 million; operating profit was Rs.728 million vs Rs.779 million, and PBT was Rs.1,142 million vs Rs.1,116 million.

• PAT was Rs.732 million vs Rs.681 million, up 7.49% YoY; tax provision was Rs.410 million vs Rs.435 million.

• Salaries and benefits rose to Rs.1,472 million from Rs.1,093 million; the increase included pay-revision provision and higher employee benefits.

Outlook and guidance

• FY1998-99 budget estimates project gross profit of Rs.1,279 million, including profit on jobs unfinished at 31 March 1998 and contracts awarded or expected to be awarded during FY1998-99.

• LNG and large power projects are target markets; discussions with international firms are underway to build capabilities and pursue work through collaboration.

• LSTK work is being pursued with established clients to use available resources; regular participation in LSTK business is anticipated in coming years.

• The order book comprised 66 large projects plus smaller assignments; strategic alliances were being developed for LNG, refinery-residue power and deep-water technology.