HFCL (HFCL) Q4 96/97 earnings summary

Executive summary

• FY97 sales, services and other income declined to Rs 21,118.86 lakh from Rs 26,006.89 lakh; net profit after prior-period adjustments fell to Rs 1,641.34 lakh from Rs 4,168.45 lakh.

• Lower DoT procurement and delayed private-operator launches weighed on results, while new products, DoT tenders and turnkey orders supported an improved outlook from 1998.

Financial highlights

• Sales, services and other income: Rs 21,118.86 lakh in FY97 versus Rs 26,006.89 lakh in FY96; sales and services were Rs 19,078.87 lakh versus Rs 24,413.36 lakh.

• Profit before depreciation, finance charges and tax was Rs 4,742.25 lakh; depreciation Rs 571.90 lakh, finance charges Rs 1,904.56 lakh, and tax provision Rs 602.77 lakh.

• PBT was Rs 2,265.78 lakh versus Rs 4,387.44 lakh; PAT before prior-period adjustments was Rs 1,665.78 lakh versus Rs 4,187.44 lakh.

• After prior-period adjustments and earlier-year tax, net profit was Rs 1,641.34 lakh versus Rs 4,168.45 lakh.

Outlook and guidance

• DoT tenders were underway; orders worth approximately Rs 165 crore were expected, while turnkey orders worth approximately Rs 300 crore had been secured from private service operators.

• Management expected technology and product development efforts to begin bearing fruit in 1998, with performance expected to improve as DoT accelerated growth and private operators commenced business.

• Planned offerings included SDH OLTE at STM-1, STM-4 and STM-16; cellular microwave radios from 7–23 GHz; SDH radio; FILL, HDSL and WILL access products.

• Infrastructure augmentation was rescheduled during market weakness and then put on a fast track for use in the current production year.