Conference Call with Syngene International Management and Analysts on Q4FY20 and full year earnings performance and outlook. Listen in for the full earnings transcript.
Conference Call with Syngene International Management and Analysts on Q4FY20 and full year earnings performance and outlook. Listen in for the full earnings transcript.
Conference Call with Blue Star Management and Analysts on Q4FY20 and Full Year Earnings Performance and Outlook. Listen in to the full earnings transcript.
Key Highlights
The spread of COVID19 in China in January had seen supply disruptions. Consequently all manufacturers including Blue Star accelerated the supply of raw materials and components in February.
However execution of orders and revenue generation came to a halt in the second fortnight of March. This compounded the magnitude of the COVID19 problem: Materials ordered began to arrive in the Indian ports, while demand fell considerably. Resulting stress on cash flow was profound, driving us to quickly build up balances in the balance sheet.
Most back end processes have functioned significantly with employees working from home. Our digital focus has allowed processes in the company to function as seamlessly as possible. We have focused on safe resumption of factories and offices when it is safe to open. Some offices in Kolkata, Bangalore and Delhi are operational.
Due to significant disruptions in supply and demand in February and March, revenues fell below expectations.
Financials can be seen here.
Tight management and receivables resulted in reduction of capital employed.
Disruptions in operating cash flow and external obligations in March 2020 necessitated additional borrowing for the company. However with tight working capital management throughout the year, borrowing actually reduced for the year to Rs. 155 crore leaving us a debt equity ratio of 0.21 (compared to Rs. 243 crore and D/E ratio of 0.28 the previous FY).
Conference Call with Havells India Management and Analysts on Q4FY20 and Full Year Earnings Performance and Outlook. Listen in to the full earnings transcript.
Call Participants: Mr. Anil Rai Gupta - Chairman and Managing Director, Mr. Rajesh Kumar Gupta - Director (Finance) and Group CFO, Mr. Rajiv Goel - Executive Director
Introductory Remarks from Anil Rai Gupta
Good morning everyone! We hope everyone is safe, secure and healthy. During the current time, safety of all our employees and stakeholders are paramount. We moved to work from home on 21st March, though the activities were disrupted from 15th of March itself. We are cautiously resuming our activities, initiating our factories.
Markets are at a slow pace as customers and dealers are acting with caution. The pick up is relatively better in semi-urban and rural areas as urban areas continue to be challenging owing to the lockdown. We have been in constant communication with our employees and dealers.
I led a live streaming with our 5,000 employees and 9,000 dealers to apprise them of our offers, protect their interests and well being. Prior to the lockdown, we had sufficient cash balance and we have been regular in paying dues for employee, vendors and all statutory government dues.
The year end incentive schemes for our dealers were also settled and paid on 31st March itself which is highly appreciated by the fraternity. We have further bolstered our cash reserves for further credit lines. Q4 had started on a healthy note with consumer businesses growing in double digits in the first two months. Lloyd had a spectacular growth in January and February and it gained momentum for March closure.
However, the loss of the last 15 days had a crippling effect at the Q4 performance. Being an year end and a quarter end, the later part of March has a disproportionate effect on the quarter sales constituting as much as 25% of the sales. We feel if disruption had not occurred, we could have grown Q4 at 9%. The external environment continues to be challenging, volatile and evolving. We are responding to the emerging scenario with agility and preparedness. We currently wish that the epidemic is controlled and economic activities resume in a very short period.
The economic activity started on the 4th of May and it's just 7-8 days of economic activities. The urban area is still opening up in a very small way but there is demand coming up from rural and semi urban. There could be a possibility that during the month of April some of the stocks would have depleted in these areas where they would have opened some shops and started selling some materials. Generally speaking, February and March are the months where we start picking up materials for the year end closure. Though, the major sales happened during the last 10 days, but still there is a little bit of higher pick up.
This was also a special year where in January and February we saw a little bit of more pick up of air conditioners because generally people were expecting that there may be some slowdown in primary sales from companies in the month of March and shortage of supply after China closure.
So, there was enough stock built up at the dealers and in reality, we are also a little bit pleasantly surprised with the start of some activities and primary sales. However, it is restricted to products like fans, air conditioners which are obviously seasonal products and which also shows that the dealers are definitely not picking up for stocking. They have secondary and tertiary sales happening at the counters.
Also, we see pick up in domestic wires sales which also means that maybe in some small towns, some construction activities were continuing during the lockdown as well and hence some requirement of wires are also coming in.
We also see small product categories like personal grooming is picking up. This is sporadic but because of our distribution in semi urban and rural areas, we have also seen some demand from rural areas for lighting products and fans specially. There is a mix of everything. I would say that the first 7-8 days are a little bit better than what we were expecting.
During the last 45 days or so, while we were expecting zero to nil collection during this period, we saw collections starting from the first week of April. From the first 7-8 days, the collections were very low from the dealers. I think in our case, we see more responsible activity coming from all sets of dealers rather than just delaying payment.
A mix of many things are timely settlement of their credit notes for the entire year. The fact is that we also have some long term funds available for such times and dealers can use that. We are not facing a problem where the dealers are expecting very long lines of credit from the company. So, when economic activity had started, generally speaking, we were in a much better shape. There is no great expectation of a credit line. Also, I would say that at this point in time, there's not enough requirement for heavy discount as it's mostly pull based sales.
Conference Call with Sterlite Tech Management and Analysts on Q4FY20 and Full Year Earnings Performance and Outlook. Listen in for the full earnings transcript.
Conference Call between Bandhan Bank Management and Analysts on Q4FY20 and Full Year Earnings Performance and Outlook. Listen in to the full earnings transcript.
Conference Call between Godrej Agrovet Management and Analysts on Q4FY20 and Full Year Earnings Performance and Outlook. Listen in to the full earnings transcript.
Conference Call with Sonata Software Management and Analysts on Q4FY20 Earnings Performance and Outlook. Listen in to the full earnings transcript.
Call Participants: Mr. Srikar Reddy - Managing Director & CEO, Mr. Jagannathan Chakravarthi - Chief Financial Officer, Mr. P.V.S.N Raju - Chief Delivery Officer, Mr. Ranganath Puranik - Chief Growth Officer, Mr. Sujit Mohanty, Head - Technology Infrastructure Business, Mr. Premnath Murthy - Vice President, Mr. R. Sathyanarayana - Head Finance & Accounts
Introductory Remarks from Srikar Reddy
Thank you all and good morning everybody. Welcome to the analyst call post the announcement of our financial results FY20 yesterday late evening and they are out there on the website and we have sent out the press release to all of you. The last two months or so have also been quite dramatic in terms of what has transpired and I am sure all of you have been observing it and experiencing it.
This crisis has a huge business impact and when you hear the various experts talk about it with both sides of the crisis - demand crisis and supply side crisis, a whole lot of dynamic government imposed regulations on what can be done and not done. So, it's been quite unprecedented in terms of the speed and revolution of the event and it has impacted our self ability and businesses to run smoothly.
We have to act actively and quickly. The first and foremost issue was the safety of our people wherever they were in the world and ensuring the rights needed to be done to ensure that people do not take any risk in trying to get their work done and getting exposed to these kinds of stuff. So, that was priority one for us and with that I should say very actively that nobody from the Sonata family has been affected by this.
I am very happy to inform you that in just 2-3 days, the Sonata Software specially in India were asked to work from home. Today we are 100% of Sonata people connected to work from home and are able to deliver work. Also, these people have been productive and were able to do different kinds of work whether project work, agile development work, ERP presentation work, etc from all different services have been delivered over the last 45 days. By these days, people have been used to different tools and systems to both collaborate with plants and internally to be able to deliver this work very effectively over the last 45 days.
Financial Highlights from Jagannathan Chakravarthi
Revenue stood at Rs 928.7 crore sequentially. There was a degrowth of 24.9%. This is basically because of our India business. There is a growth of around 11.1% YoY basis
EBITDA for the year at consolidated level is at Rs 95.2 crore sequentially. This had a degrowth of 19.5% and YoY there was a degrowth of about 1.7%
The PAT for the quarter is Rs 61.8 crores sequentially. There was a degrowth of 18.6% and YoY there was a degrowth of 5.5%
The return on capital employed on consolidated level is 33%
There was a little increase in the consolidated DSO in this quarter
For the whole year, the revenue stood at 3743.3 crore. That is a sequential growth of 36.4%
EBITDA for the whole year is Rs 131.2 crores. There is a sequential growth of about 17.9% YoY
For international IT services - the break up of Q4 revenue is around Rs 325.5 crore. There is a sequential degrowth of 1.3% and YoY 7% growth. This contributed about 35% of our consolidated revenue
EBITDA for the quarter is Rs 72.3 crores. There is a sequential degrowth of 21.1% and YoY is about 4.6%
PAT for the quarter is Rs 45.2 crores, sequential degrowth of 71.8% and YoY degrowth of 13.9%. This contributed to 73.2% of consolidated cash
There was an addition of 6 new customers during the quarter. International head count is at 4,066 accounts as of March 31st, 2020
The return on capital employed is 35% return on net worth is 35%
For the financial year, the revenue was Rs 1,272.6 crore. There is a sequential growth of 13.6% and this contributed YoY 34% of consolidated revenue
The domestic business revenue for the quarter is Rs 607 crores. Compared to the last quarter, there is a degrowth of 33.4%. EBITDA for the quarter is Rs 23.2 crore. QoQ there is a degrowth of 7.9% and there is a growth of 9.3% YoY. PAT is at Rs 16.6 crores and there is a QoQ degrowth of 8.2% and YoY growth of 28.9%
For the whole year, revenue from domestic business is at Rs 2,492.2 crore. There is YoY growth of 33.8%. This contributed to 66.6% of the consolidated revenue. EBITDA for the year is Rs 95.1 crore, the YoY growth is at 76.1% , PAT is Rs 64.4 crores, YoY growth is about 39.2%
