HFCL (HFCL) Q4 99/00 earnings summary

Executive summary

• FY 1999-2000 revenue rose 44% to Rs. 599.72 crore; net profit increased 139% to Rs. 85.97 crore, supported by telecom turnkey and optical fibre cable business.

• Growth strategy expanded beyond equipment manufacturing and turnkey execution into basic telephony, broadband, software and B2B e-commerce through acquisitions and joint ventures.

Financial highlights

• Sales and services reached Rs. 578.86 crore, up 45% YoY; total revenue was Rs. 599.72 crore, up 44%.

• Operating profit (PBIDT) increased 89% to Rs. 146.25 crore; PBT rose 141% to Rs. 96.98 crore and PAT rose 139% to Rs. 85.97 crore.

• EPS was Rs. 10.97, up 111% YoY; the recommended equity dividend was 25%, versus 10% in FY 1998-99.

• FY 2000-01 Q1 turnover was Rs. 253.9 crore, up 228% YoY, and net profit was Rs. 61.7 crore, up 641%.

Outlook and guidance

• HFCL Infotel’s Punjab basic telephony, internet and data services were scheduled to launch in October 2000; the network was under installation.

• Optical fibre cable capacity expansion was planned from 5,000 to 15,000 ckm; further capacity additions were planned for other products.

• R&D priorities included broadband access, DWDM, wireless and satellite telephony, ATM PON, Internet access systems and converged voice, data and video products.

• Strategy included overseas turnkey contracts, international market expansion, technology acquisitions and using the Kerry Packer joint ventures to pursue software and e-commerce opportunities.