VA Tech Wabag (WABAG) Q4 10/11 earnings summary

Executive summary

• FY11 consolidated sales rose 1% YoY to ₹1,233 crore; EBITDA reached ₹121 crore and PAT ₹53 crore, with order backlog up 20% to ₹3,402 crore.

• Standalone turnover grew 4.5% to ₹732 crore; PAT increased 35% to ₹55.26 crore, supported by lower interest costs, higher interest income and lower depreciation.

Financial highlights

• Consolidated EBITDA was ₹121 crore versus ₹117 crore; EBITDA margin improved to 9.7% from 9.5%, while PAT margin rose to 4.2% from 3.6%.

• Consolidated basic and diluted EPS were ₹53.07 and ₹52.96, up from ₹47.84 and ₹47.04, respectively.

• Standalone EBITDA was ₹89.67 crore versus ₹86.04 crore; basic and diluted EPS were ₹55.78 and ₹55.67 versus ₹43.80 and ₹43.07.

• Consolidated results included ₹12.86 crore of exceptional arbitration losses relating to two legacy overseas projects; excluding this item, no adjusted profit figure was stated.

Outlook and guidance

• Growth priorities include higher-margin O&M, BOOT/concession projects, new geographies and strategic partnerships; management expected these initiatives to support a higher growth trajectory.

• FY12 revenue sources for municipal projects include APGENCO, IOCL and Chennai Metrowater; international projects are expected to contribute from Sri Lanka, Philippines and Oman.

• Nemmeli desalination was progressing to plan, with commissioning targeted for early 2012; the Paradip refinery recycle plant was scheduled to begin commissioning in spring 2012.