JSW Steel (JSWSTEEL) Q4 18/19 earnings summary

Executive summary

• FY 2018-19 set records for crude steel production, shipments, revenue and EBITDA; capacity utilisation reached 93%.

• Domestic sales growth and a higher share of value-added and special products supported results despite a weaker second half and lower global steel prices.

Financial highlights

• Consolidated revenue from operations was ₹84,757 crore, up 16% YoY; operating EBITDA was ₹18,952 crore, up 28%, and net profit was ₹7,524 crore, up 23%.

• Standalone revenue was ₹76,727 crore, up 13% YoY; operating EBITDA rose 34% to ₹18,403 crore and net profit rose 79% to ₹8,259 crore.

• Standalone diluted EPS was ₹34.17 versus ₹19.14; consolidated diluted EPS was ₹31.60 versus ₹25.71.

• Operating cash flow was ₹16,104 crore standalone and ₹14,633 crore consolidated; capital expenditure cash outflow was ₹7,902 crore and ₹10,206 crore, respectively.

Outlook and guidance

• Capacity is planned to rise from 18 MTPA to 24 MTPA by March 2020; the Vijayanagar BF-3 upgrade shutdown was deferred until Dolvi’s new blast furnace commissions and ramps up.

• India steel demand was forecast to grow above 7% in CY 2019 and CY 2020, reaching 100–105 MnT, supported by infrastructure spending and economic growth.

• The FY 2019-20 plan targets more than ₹300 crore of additional digital-led savings; portfolio strategy aims for VASP to exceed 50% of sales mix.

• Expansion and downstream projects are expected to add 3.95 MTPA of capacity, with commissioning planned across FY 2019-20 and FY 2020-21.