Godawari Power & Ispat (GPIL) Q4 11/12 earnings summary

Executive summary

• FY12 was described as challenging, yet standalone revenue rose 83% and operating profit 21%; net profit increased 11% YoY.

• Standalone production volumes grew across most divisions; pellet plant utilization exceeded 104%, while captive iron ore mining was disrupted by local issues, extended monsoon and logistics.

Financial highlights

• Standalone total revenue was ₹1,734.54 crore vs ₹937.76 crore; EBITDA ₹237.75 crore vs ₹196.36 crore; PBT ₹99.83 crore vs ₹89.28 crore; PAT ₹78.95 crore vs ₹71.27 crore.

• Consolidated total revenue was ₹2,071.76 crore vs ₹1,131.51 crore; EBITDA ₹293.10 crore vs ₹247.79 crore; PBT ₹109.60 crore vs ₹119.27 crore; net profit ₹84.27 crore vs ₹85.87 crore.

• Standalone net sales turnover rose 85% to ₹1,731.50 crore, driven by higher volumes and improved realizations across divisions, except ferro alloys and power.

Outlook and guidance

• A 1.2 mtpa pellet plant was under implementation, with commissioning expected in Q2FY14; feedstock planned from captive mines and partial market purchases.

• The 50 MW solar thermal project was expected to commission by April 2013; full power offtake contracted with NVVN at ₹12.2/unit for 25 years.

• Captive iron ore supply was expected to lower consumption cost by ~₹2,000/ton and support higher operating margins; management expected mine operations to improve.

• Plans emphasized improving pellet plant efficiencies, maximizing steel production and completing ongoing projects.