Godawari Power & Ispat (GPIL) Q4 12/13 earnings summary

Executive summary

• Consolidated revenue from operations rose 14.38% YoY to ₹2,356.71 crore; net profit after minority interest increased 76.59% to ₹148.81 crore in FY13.

• Integrated iron ore, pellet, steel and power operations supported growth amid weak economic and steel-sector conditions; major pellet and solar projects expanded capacity and future revenue visibility.

Financial highlights

• Consolidated gross sales increased 17.22% to ₹2,685.34 crore; net sales were ₹2,356.71 crore versus ₹2,060.43 crore in FY12.

• Consolidated EBITDA rose to ₹345.71 crore from ₹306.96 crore; PBT was ₹153.73 crore versus ₹109.60 crore.

• Standalone net sales increased 9.42% to ₹1,911.63 crore; EBITDA was ₹250.63 crore versus ₹237.75 crore, while PAT rose to ₹124.14 crore from ₹78.95 crore.

• Recommended FY13 dividend of ₹2.50 per share, unchanged YoY; standalone total dividend outflow including tax was ₹9.48 crore.

Outlook and guidance

• Indian steel demand was forecast to grow from 5.5% in FY13 to 7% in FY14; broader economic growth was expected to improve from FY15.

• Pellet capacity planned to double from 12 lakh TPA in FY13 to 24 lakh TPA in FY14, supporting higher volumes and margins.

• After FY14 capex completion, priorities were business consolidation, profit generation and debt repayment; cost-reduction initiatives were expected to further improve margins.

• A 50 MW solar project was expected to provide revenue under a 25-year fixed-price power purchase agreement.