Titagarh Rail Systems (TITAGARH) Q4 11/12 earnings summary

Executive summary

• FY12 standalone revenue and profit declined YoY amid lower wagon realizations and higher input costs; consolidated revenue and EBITDA increased, supported by subsidiaries and joint ventures.

• Strategic priorities included growth across business verticals, productivity and cost control, working-capital improvement, capacity upgrades, and an in-principle restructuring plan.

Financial highlights

• Standalone net revenue was Rs 64,432.99 lacs vs Rs 66,670.78 lacs; EBITDA was Rs 13,090.36 lacs vs Rs 13,611.90 lacs.

• Standalone PBT was Rs 11,482.24 lacs vs Rs 12,261.15 lacs; PAT was Rs 7,662.45 lacs vs Rs 8,139.42 lacs.

• Consolidated net revenue rose to Rs 89,094.51 lacs from Rs 72,441.16 lacs; EBITDA increased to Rs 16,504.00 lacs from Rs 13,442.40 lacs.

• Consolidated profit before tax, exceptional items and extraordinary items was Rs 13,668.02 lacs; exceptional items were Rs 1,238.00 lacs and attributable profit was Rs 8,316.72 lacs.

• Other income included Rs 426.81 lacs of provisions written back, a Rs 105.38 lacs investment-sale gain and a Rs 128.82 lacs fixed-asset-sale gain.

Outlook and guidance

• Wagon demand was expected to remain firm, while private-sector orders were being pursued under the Wagon Leasing Policy and Wagon Investment Scheme.

• Orders for 12 MEMU and 11 EMU rakes were secured; delivery was expected to proceed smoothly and the coaches outlook was described as encouraging.

• Steel Castings was viewed as having significant growth potential; HEMM focus was on product changes and marketing to improve revenue and profitability.

• The 2012-13 Railway Budget envisaged procurement of 13,000 wagons vs 18,000 in FY12, with freight loading capacity raised by 55 MT to 1,025 MT.