Redington (REDINGTON) Q4 14/15 earnings summary

Executive summary

• FY15 consolidated revenue rose 12.9% to ₹31,622.7 crore and profit grew 14.8% to ₹386.5 crore, despite subdued Indian demand, volatile currencies and geopolitical pressures.

• Both India and overseas operations grew revenue and profits; overseas growth and value-added distribution, logistics and support services helped sustain earnings.

Financial highlights

• Consolidated revenue was ₹31,622.7 crore vs ₹28,005.1 crore YoY; reported growth was 13%, with a five-year CAGR of 17%.

• Consolidated EBITDA rose 5.6% to ₹761.9 crore; PBT was ₹555.5 crore vs ₹485.1 crore, and PAT attributable to shareholders was ₹386.5 crore vs ₹336.6 crore.

• Consolidated EPS increased to ₹9.67 from ₹8.43; standalone PAT fell to ₹182.0 crore from ₹239.8 crore, reflecting prior-year profit on sale of Easyaccess Financial Services.

• Standalone revenue increased 6.7% to ₹12,070.4 crore; PBT before exceptional items rose 9.2% to ₹272.8 crore.

Outlook and guidance

• Near-term demand outlook was cautious: expected recovery in India had not materialized, while depressed oil prices and currency weakness were expected to slow overseas investment and demand.

• FY16 strategy focused on strengthening core distribution, automation and cost efficiency, expanding mobility offerings, and building vendor-agnostic IaaS, PaaS, SaaS and managed cloud services.

• Digital India, Smart City and e-governance projects were seen as potential drivers for servers, storage, networking, software, security and surveillance products.

• ProConnect planned to pursue e-commerce and third-party logistics opportunities; Ensure aimed to expand after-sales and warranty support, including services for e-commerce.