NTPC (NTPC) Q4 07/08 earnings summary

Executive summary

• FY08 gross revenue reached Rs.400.113bn, up 13.1% YoY; generation was 200.863bn units, up 6.46%, with 19.12% of national capacity and 28.51% of generation.

• Coal stations achieved a record 92.24% PLF; net profit was Rs.74.148bn, up 8% reported and 15% on an adjusted basis.

Financial highlights

• Energy sales were Rs.369.462bn, up 14% YoY; units sold rose 6.49%, while average selling price increased to Rs.1.97/unit from Rs.1.84.

• PBT was Rs.102.549bn vs Rs.89.074bn; reported PAT was Rs.74.148bn vs Rs.68.647bn. Adjusted PAT, excluding prior-period items and specified adjustments, rose 15%.

• Fuel expense increased 11% to Rs.220.202bn, primarily due to higher fuel prices; operational expenses rose 13.34% to Rs.255.446bn, or Rs.1.28/unit vs Rs.1.20.

• Employee remuneration and benefits rose 63% to Rs.18.960bn, including estimated wage-revision arrears of Rs.4.094bn; depreciation increased 3% to Rs.21.385bn.

• Operating cash flow increased 26% to Rs.101.711bn; net cash used in investing was Rs.62.038bn, and financing cash outflow was Rs.23.487bn.

Outlook and guidance

• FY09 target: place 3,000 MW into commercial generation, place orders for 11,000 MW, and commence production from Pakri-Barwadih coal mine.

• Targets remain 50,000 MW-plus capacity by 2012 and 75,000 MW-plus by 2017; 16,680 MW was under construction at the reporting date.

• Planned additions are to be financed at 70:30 debt-to-equity; internal accruals are expected to fund the equity component.

• By 2017, planned mix includes ~53,000 MW coal, 10,000 MW gas, 9,000 MW hydro, ~2,000 MW nuclear and ~1,000 MW renewables.