Lloyds Metals And Energy (512455) Q1 24/25 earnings summary

Executive summary

• Achieved record quarterly iron ore and DRI production in Q1 FY25, resulting in highest ever revenue and profit, with total income of INR 24,231 Mn and PAT of INR 5,574 Mn, driven by higher volumes and improved realizations.

• Maintains a debt-free status, with all expansion plans funded internally or through recent equity raises, and a strong balance sheet supporting swift project execution.

• Ongoing expansion includes significant CapEx investments in slurry pipeline, pellet plant, and DRI capacity doubling, with forward integration into pellet and steelmaking capacities.

• Unaudited standalone and consolidated financial results for Q1 FY25 were approved by the Board on 30th July 2024, with statutory auditors issuing an unqualified limited review report.

Financial highlights

• Q1 FY25 revenue reached INR 2,428 crore (INR 24,231 Mn), up 23% year-over-year, driven by record sponge iron and iron ore volumes; EBITDA grew 32% year-over-year to INR 7,245 Mn, with margins improving to 29.9%.

• PAT increased 38.2% YoY to INR 5,574 Mn; diluted EPS at 10.96, up 38.2% YoY; consolidated profit after tax for Q1 FY25 was ₹557.40 crore.

• Iron ore production was 4 million tons, dispatches at 3.6 million tons, with average realization of INR 5,710 per ton, a 7% year-over-year increase.

• DRI production was 76,704 tons, up 16% year-over-year; power segment sales rose 5% year-over-year.

• CSR expenses surged to INR 68 crore in Q1 FY25 due to completion of capital projects like schools and hospital.

Outlook and guidance

• Iron ore production guidance capped at 25 million tons for the next financial year; all upcoming projects expected to have a payback period of less than 4 years.

• Expect to be up and running with expanded mining capacity by January 2025, subject to EC approval; pellet plant and slurry pipeline expected to be operational by end of FY25.

• Expansion plans target 12 MNT pellet and 4.2 MNT steelmaking capacities, with ongoing investments in slurry pipelines and DRI plants.

• CSR expenses expected to normalize to INR 7-8 crore per quarter for the remainder of the year.