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THERMAX Q4FY2020 CONCALL

Q4FY20

Dividend

The board has approved a dividend of Rs7/share for FY2019-20.

Q4FY20

CONCALL

RESULT ANALYSIS - CONCALL

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952

The management stated that the order book has seen a reduction from Rs 1,157 crore for the previous quarter vs Rs 952 crore for the current quarter, with India contributing to Rs 594 crore for the quarter and exports contributing to Rs 358 crore, down from Rs 488 crore last year.

ORDER BOOK

5770

5490

The order book for FY20 stood at Rs 5490 crore vs Rs 5,770 crore for the previous year. Order balance stands at Rs 5,238 crore vs Rs 5,370 crore for the previous year. The reduction came from the lockdown affecting operations across the world.

Annual Order Book

5370

5238

Order Book Breakup

Total Order book 5,498 Cr for FY20:

  • Energy stood at Rs 3280 crore,
  • Environment stood at Rs 1,777 crore
  • Chemicals ar 441 crore,

Order balance Rs.5,238 Cr for:

  • Energy is at Rs 3,557 crore,
  • Env at Rs 1,601 crore and
  • Chemicals is at Rs 80 crore,

In terms of geographical order balance, domestic orders are at Rs 3,795 crore and exports are at Rs 1,443 crore.

2126

REVENUE

The Q4FY20 revenue stood at Rs 1,354 crore vs Rs 2,126 crore for the previous year, the reduction was not only due to the lockdown but also due to unsold finished goods in stock and project under work-in-progress, not being able to realise their material worth about Rs 400-500 crore.

1354

500

PBT

The PBT has dropped to Rs 375 crore from Rs 500 crore from last year. Treasury income is negative Rs 24 crore, the cooling division had negative Rs 14 crore which will be managed by the company, additional depreciation at Rs 25 crore, a digitalisation move by bringing in an external consultant has a one-time cost of Rs 14 crore.

375

Operationally the company has been intact, the company has started the year with a Rs 5,300 crore carry forward in order book and Q1FY21 might be a washout, Q2FY21 will see some recovery, while Q3FY21 mid will see normalcy returning for the company.

GOALS

MANAGEMENT COMMENTRY

Factories in India were shut-down while factories in Denmark, Poland and Germany continued operations. The chemical factories started from mid-April and are currently operating at 40-50% capacity.

All factories of Thermax are running now with 25-50% capacity globally.

On the labour front, the company did not have any contract labour and hence faced no problems but the supply chain, which has a lot of MSME suppliers, will face difficulties due to migrant labour problem.

LABOUR

RAW MATERIAL

Raw material shortage is non-existent. The company has outstanding orders of Rs 154 crore and purchases of Rs 3,500 crore, given the current situation, the company is looking for alternative sources for the same. China's banishment from India benefits Thermax to some extent as they can seek more opportunities locally.

The company has been successful in bring down its working capital from Rs 200 crore last year to Rs 128 crore while the days sales outstanding has also seen reduction from FY19.

The company also had some FX exposure of Rs 15 crore for the quarter due to MTM losses.

Working Capital

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