VOLT's Projects business continued to face challenges from legacy projects in FY14, reporting losses for the third consecutive year. However, the company was able to reduce losses compared to previous years. RIEL achieved EBITDA breakeven but continued to report cash losses. VOLT's net working capital improved on a standalone basis but remained elevated on a consolidated level. The company rationalized its workforce to reduce costs. Its Unitary Cooling products division grew revenues by 39% and expanded margins, while demand for textile machinery remained subdued.
Asian Paints (APL) reported weak quarterly results for 2QFY2011, with revenue growth of only 5% year-over-year due to heavy monsoons and a shift in festival sales to the next quarter. Recurring earnings grew by a muted 4.4% as margins contracted slightly despite price hikes. However, gross margins unexpectedly expanded due to the full impact of recent price increases. The analyst maintains a 'Buy' rating, expecting growth to pick up in the second half as festival sales are recorded and price hikes provide higher value growth, while revising full-year estimates slightly to account for the disappointing quarter.
Long term investment: Buy Bharat Forge for target price of Rs1220IndiaNotes.com
Bharat Forge Ltd. (BFL), the flagship company of the USD2.5 billion Kalyani Group is a global provider of high performance, innovative, safety & critical components and solutions to various industries.
1) GOL reported a 17% increase in air traffic in 2Q10 compared to the same period last year, with net passenger revenues increasing 13.2% and ancillary revenues such as cargo services growing 57.8%. Aircraft productivity also increased.
2) Fleet renewal is lowering costs, as 5 older Boeing 737-300 aircraft were returned, saving $3.5 million per quarter, while 4 Boeing 767 aircraft were reactivated. Newer aircraft will provide better performance and fuel efficiency.
3) For the second half of 2010, GOL expects flat yields and a focus on maintaining a 70% load factor. Traffic growth is forecast at 14-21% for the full year.
The SKF Group saw a significant drop in sales volumes in the first quarter of 2009 compared to the same period in 2008. Net sales decreased 4.8% while operating profit declined significantly. Demand is expected to remain low in the second quarter, with a similar decline in volume year-over-year. The company has implemented actions to reduce costs and focus on profitability and cash flow. Looking ahead, the outlook remains weak given continued economic uncertainty and risks in the business environment.
This document provides an earnings report for Oshkosh Corporation for the fourth quarter of fiscal year 2014. It summarizes key financial results including adjusted earnings per share of $0.96, above the prior year and expectations. For fiscal year 2015, the company estimates adjusted earnings per share will be between $4.00-$4.25. The report also outlines expectations and initiatives for each of the company's business segments in the coming year.
Shriram Transport Finance Company Q1FY15: Buy for a target of Rs1130IndiaNotes.com
Shriram Transport’s 1QFY15 PAT declined 10% YoY and (up 4% QoQ to INR3b (In line). Moderation in AUM growth (+4% YoY to INR544b), decline in disbursements (7% YoY), and improvement in margins (10bp QoQ) are key highlights of the quarter; buy.
Financial analysis of manufacturing industryANIRUDH BANSAL
This document provides an executive summary and overview of a financial analysis report on the industrial manufacturing sector in India from 2006-2015. The report analyzes the financial statements of 5 major manufacturing companies (Siemens, BEML, Bharat Electronics, Bharat Forge, Bharat Heavy Electricals) to assess past and current performance, predict profitability, bankruptcy risk, and operational efficiency. It also provides details on the growth, market size, investments, and government initiatives in the industrial manufacturing sector in India. The financial analysis section examines profits, expenses, liabilities, assets, and key financial ratios of the companies. It concludes with recommendations for long-term investors.
Asian Paints (APL) reported weak quarterly results for 2QFY2011, with revenue growth of only 5% year-over-year due to heavy monsoons and a shift in festival sales to the next quarter. Recurring earnings grew by a muted 4.4% as margins contracted slightly despite price hikes. However, gross margins unexpectedly expanded due to the full impact of recent price increases. The analyst maintains a 'Buy' rating, expecting growth to pick up in the second half as festival sales are recorded and price hikes provide higher value growth, while revising full-year estimates slightly to account for the disappointing quarter.
Long term investment: Buy Bharat Forge for target price of Rs1220IndiaNotes.com
Bharat Forge Ltd. (BFL), the flagship company of the USD2.5 billion Kalyani Group is a global provider of high performance, innovative, safety & critical components and solutions to various industries.
1) GOL reported a 17% increase in air traffic in 2Q10 compared to the same period last year, with net passenger revenues increasing 13.2% and ancillary revenues such as cargo services growing 57.8%. Aircraft productivity also increased.
2) Fleet renewal is lowering costs, as 5 older Boeing 737-300 aircraft were returned, saving $3.5 million per quarter, while 4 Boeing 767 aircraft were reactivated. Newer aircraft will provide better performance and fuel efficiency.
3) For the second half of 2010, GOL expects flat yields and a focus on maintaining a 70% load factor. Traffic growth is forecast at 14-21% for the full year.
The SKF Group saw a significant drop in sales volumes in the first quarter of 2009 compared to the same period in 2008. Net sales decreased 4.8% while operating profit declined significantly. Demand is expected to remain low in the second quarter, with a similar decline in volume year-over-year. The company has implemented actions to reduce costs and focus on profitability and cash flow. Looking ahead, the outlook remains weak given continued economic uncertainty and risks in the business environment.
This document provides an earnings report for Oshkosh Corporation for the fourth quarter of fiscal year 2014. It summarizes key financial results including adjusted earnings per share of $0.96, above the prior year and expectations. For fiscal year 2015, the company estimates adjusted earnings per share will be between $4.00-$4.25. The report also outlines expectations and initiatives for each of the company's business segments in the coming year.
Shriram Transport Finance Company Q1FY15: Buy for a target of Rs1130IndiaNotes.com
Shriram Transport’s 1QFY15 PAT declined 10% YoY and (up 4% QoQ to INR3b (In line). Moderation in AUM growth (+4% YoY to INR544b), decline in disbursements (7% YoY), and improvement in margins (10bp QoQ) are key highlights of the quarter; buy.
Financial analysis of manufacturing industryANIRUDH BANSAL
This document provides an executive summary and overview of a financial analysis report on the industrial manufacturing sector in India from 2006-2015. The report analyzes the financial statements of 5 major manufacturing companies (Siemens, BEML, Bharat Electronics, Bharat Forge, Bharat Heavy Electricals) to assess past and current performance, predict profitability, bankruptcy risk, and operational efficiency. It also provides details on the growth, market size, investments, and government initiatives in the industrial manufacturing sector in India. The financial analysis section examines profits, expenses, liabilities, assets, and key financial ratios of the companies. It concludes with recommendations for long-term investors.
Format for financial results for listed entities which have listed their deb...GAURAV KR SHARMA
1. The Securities and Exchange Board of India (SEBI) has issued guidelines on the format for financial results that listed entities must follow when publishing their half-yearly and annual financial results.
2. The guidelines mandate specific formats for different types of companies, including formats for companies other than banks/NBFCs, formats for banks/NBFCs, and an alternative format for some manufacturing, trading and service companies.
3. The formats include line items for income, expenditures, profits, reserves, ratios and other financial details. Limited review reports from auditors must also follow specified formats.
Mahindra and Mahindra (M&M) reported quarterly results that beat expectations. Net sales increased 19.2% year-over-year to Rs. 5,434 crore, supported by a 21% growth in core volumes. Operating performance and profit also exceeded forecasts due to better operating leverage and higher other income. EBITDA margins were 16.5%, ahead of estimates. Net profit grew 7.9% to Rs. 758 crore, driven by strong operating performance and higher other income. Overall, healthy volume growth and better cost management supported M&M's financial performance in the quarter.
Goodrich announced strong financial results for the second quarter of 2007, with net income per share increasing 53% and sales growth of 9% compared to the same period last year. Segment operating margins increased from 14% to 16%. Goodrich increased its full year 2007 outlook, with expected sales now between $6.5-6.6 billion and net income per share of $3.50-3.60, up from previous estimates. Goodrich signed a new long-term agreement with Boeing and saw continued growth across its business segments and market channels in the second quarter.
This document is General Dynamics' 2007 Annual Report. It provides an overview of the company's strong financial performance in 2007, with record sales, earnings, and backlog across all business segments. Specifically, it notes that net sales increased 13% to $27.2 billion, operating earnings increased 21% to $3.1 billion, and backlog reached a historic high of $46.8 billion. The report summarizes key achievements and growth drivers for each of the company's four business segments - Aerospace, Combat Systems, Marine Systems, and Information Systems and Technology. It also discusses the company's continued focus on operational improvements, cash generation, capital deployment strategies, and outlook for another productive year in 2008.
- Gama Aviation reported financial results for the full year 2020 that showed declines in revenue and earnings due to the impact of the COVID-19 pandemic on the aviation sector. However, the company maintained a strong cash position.
- Key operational highlights included new contracts in special missions and technology outsourcing, the sale of a US subsidiary, and continued customer service despite pandemic challenges.
- Financially, revenue declined 26% while adjusted EBIT swung to a loss, reflecting lower activity and impairments, though the second half showed stable underlying performance. Cash flow was strong.
- The company implemented a new strategic business unit structure in 2021 to focus on high-value markets and long-term customer partnerships for future growth
Crompton Greaves 3QFY15 performance remains a mixed bag; buyIndiaNotes.com
- Crompton Greaves' standalone business reported stable results for 3QFY15, with revenues down slightly and margins flat. However, the overseas business slipped to an operating loss due to legacy order costs.
- Total revenues were down 1.5% for standalone but up 8.4% in Euros for overseas. The overseas business reported an operating loss due to costs from executing a legacy order.
- Motilal Oswal maintains a "Buy" rating but cuts earnings estimates due to delays in overseas business turnaround. They forecast stronger standalone growth over the next two years despite near-term margin pressures.
This document provides an overview and summary of SBM Offshore's business and strategy. Some key points:
- SBM Offshore is a leading provider of floating production solutions to the offshore oil and gas industry. It has the largest leased FPSO fleet worldwide.
- The company's strategy is to focus on its core FPSO business and services where it has historically achieved good margins. This includes improving project selection and risk management.
- Emerging opportunities for growth include increasing demand for oil production from deep and ultra-deep waters. SBM Offshore believes its FPSO technology is well positioned for these complex projects.
- The document discusses various projects, recent contract awards, and key financial metrics to
- Gama Aviation reported revenue growth of 22.5% in the first half of 2019 to $121.8 million, with gross profit up 19.9% to $23.5 million. Net debt increased to $24.9 million from $2.9 million at the end of 2018.
- The Ground division performed strongly with revenue, gross profit, and adjusted EBIT growth, benefiting from good performance in the US and Europe. However, the Global Services division was impacted by the loss of two airline customers.
- While financial performance was in line with expectations, the net debt position increased due to strategic investment, working capital growth, and slower recovery of some trade receivables. The outlook for
This document provides an overview and summary of SBM Offshore's presentation at the Barclays Conference in September 2013. Some key points:
- SBM Offshore is a leading FPSO provider with 16 FPSOs currently in its lease fleet and over 160 years of FPSO experience.
- Emerging opportunities for FPSOs include remote discoveries favoring floating production, exponential technology demand, and potential for units producing over 100,000 bbl/day.
- SBM's strategy is to focus on core FPSO products and services to improve risk/reward balance and financial returns, through selective bidding, investment in technology, and strengthening local content.
- The outlook presented over 20 potential FPSO project
Doug Wilburne presented at the Bank of America Merrill Lynch Global Industrials & EU Autos Conference on March 15, 2016. He discussed Textron's commitment to future growth through investing organically and acquisitions. Key financial highlights included revenue down 3.3% but segment profit up 3.4% and EPS up 17.4%. Textron has capital available for value-creating acquisitions and opportunistic share buybacks.
Bruker Corporation reported financial results for Q1 2015 with revenues of $353.5 million, down 17% year-over-year due to currency impacts and divestitures. Non-GAAP earnings per share were $0.14, up 27% from $0.11 in Q1 2014, driven by restructuring initiatives and operational improvements. For full-year 2015, Bruker expects organic revenue growth of approximately 1% and over 100 basis points of non-GAAP operating margin expansion despite currency headwinds.
The document analyzes the financial statements of a steel company for the fiscal year 2015-2016. It finds that while the company's sales volume grew, revenues declined 14.12% due to oversupply and price cuts. Expenses like finance costs and R&D spending increased. Assets like tangible assets grew due to capital expenditures, while inventories and cash balances declined. The company faces legal contingencies that could significantly impact its financial position if resolved adversely.
L&T reported strong quarterly results that beat market expectations, with revenue growth of 32% and net profit growth of 94% over the previous quarter. However, annual order inflows declined 12% for the first time since 2008, missing guidance. While international markets like the Middle East offer growth opportunities, high inflation and a slowing domestic economy may pressure margins going forward. The analyst maintains a neutral outlook on L&T until further developments emerge.
The document provides an investor overview for Curtiss-Wright Corporation for the first quarter of 2016. Some key points:
- Curtiss-Wright is a global industrial company providing highly engineered products and services to aerospace, defense, and industrial markets, with $2.2 billion in estimated 2016 sales.
- The company has leadership positions in growing markets such as commercial aerospace, power generation, and defense.
- Financial goals include 3-5% organic sales growth, over 14% operating margin, and over 100% free cash flow conversion.
Curtiss-Wright First Quarter 2016 Financial Resultsq4curtisswright
The document provides an earnings conference call summary and outlook for Curtiss-Wright Corporation for 1Q 2016 and full year 2016. Some key points:
- 1Q 2016 EPS of $0.73, ahead of expectations, with lower costs and strong free cash flow of $61M. However, sales decreased 8% due to weaker industrial markets.
- Full year 2016 guidance expects sales growth of -1% to 1% with operating margin expansion to 14.0-14.2% through cost savings and improving defense and power markets.
- The outlook expects solid earnings growth of 7-11% and continued strong free cash flow of $290-310M through ongoing initiatives and AP1000 reactor component sales.
Barnes Group is an international industrial and aerospace manufacturer and services provider with two business segments: Industrial and Aerospace. The document provides an overview of Barnes Group, including its history dating back to 1857, key acquisitions and divestitures, end markets, strategic focus on driving profitable growth, and financial performance trends showing sales increasing 3-6% annually and adjusted operating margins expanding to a target of 16-17% by 2015.
UniCredit initiates coverage of Italian construction company CMC with a buy recommendation. CMC has expertise in complex tunneling projects which supports its international expansion. It focuses on lower-risk contracts which has led to steady profits. While Italy remains an important market, CMC is increasing its international backlog which reduces risk. Strong backlog provides revenue visibility, though profits remain dependent on a few large projects which is declining. Deleveraging is expected to continue.
This document summarizes Broadwind's 2014 earnings conference call. It discusses Broadwind's financial results for 2014, including improved sales and narrowed operating losses. It also provides an overview of the wind industry market conditions and Broadwind's priorities for 2015, which include growing sales, achieving profitability, and margin improvement through initiatives like restoring tower production capacity. The document contains forward-looking statements and disclaimers about the accuracy of industry data.
SKF reported strong financial results for the third quarter and first nine months of 2010, with record operating profits and margins. Sales and manufacturing levels increased significantly compared to the same periods in 2009. SKF also announced new, higher financial targets and the acquisition of Lincoln Industrial, a leading lubrication systems company, for $1 billion.
Contents1.0Background11.1 Industry Overview11.2 Financi.docxmaxinesmith73660
Contents
1.0 Background 1
1.1 Industry Overview 1
1.2 Financial Background 1
2.0 Analysis of Accounting Quality 2
2.1 Vodafone PLC 2
2.2 Zain 3
3.0Trend Analysis 3
3.1 Financial Position 3
3.2 Revenue 4
4.0 Profitability Analysis 5
4.1 Return on Capital Employed 5
4.2 Profitability at Operational level 5
4.3 Financial Leverage 6
4.4 Operating Spread 6
4.5 Second Level of Decomposition 7
4.5.1 Profit Margin 7
4.5.2 Asset Turnover 7
5.0 Industry Analysis 7
5.1 Vodafone 7
5.2 Zain 9
6.0 Conclusion 10
7.0 References 11
8.0 Appendix 12
Return on Capital Employed - Inter-firm comparison 13
First Level Inter-firm Analysis 13
Financial Leverage 14
Net Borrowing Cost 14
Operating Spread 14
Second Level Inter Firm Analysis 15
Asset turnover 16
Drivers of Profitability – Vodafone – European Market 17
Drivers of Profitability – Zain Telecom – GCC Market 19
List of Tables
Table 1:1 Trend Analysis - Vodafone – Abstract4
Table 1:2: Trend Analysis - Zain Telecom - Abstract4
Table 1:3: Income Trend Analysis - Vodafone - Abstract 4
Table 1:4 Income Trend Analysis - Zain – Abstract5
Table 1: 5 Return on Capital Employed - Vodafone vs. Zain5
Table 1:6 Return on Net Operating Assets - Vodafone vs. Zain6
Table 1:7 Financial Leverage: Vodafone vs. Zain6
Table 1: 8 Operating Spread - Vodafone vs. Zain 6
Table 1:9 Profit Margin - Vodafone vs. Zain7
Table 1: 10 Asset Turnover - Vodafone vs. Zain 7
Table1: 11 Industry Average - Vodafone vs. Europe8
Table 1:12 Industry Analysis - Zain vs. Gulf9
ii
1.0 Background
It is impossible to imagine modern society without mobile telecommunications given that three billion calls are made each day in the US alone (Romano, 2013), there are more than 6.8 billion mobile telecommunications subscribers worldwide, and today, 96.2 out of every 100 people are expected to have a mobile device (Mobi-thinking, 2013). If these figures are not astonishing enough, the number of mobile subscribers is likely to surpass the world’s population in 2014 (Pramis, 2013). A total of 1.9 billion cell phones were sold in 2012, and the number does not seem as though it will fall anytime soon; in fact, the number is likely to grow to 2.6 billion by 2016 (Mobi-thinking, 2013). In 2011 in the UK, the number of mobile calls surpassed landline calls (Lee, 2013). Vodafone Group is the second largest service provider in the world, with a 2013 revenue of more than £44 billion (Mobi-thinking, 2013). However, assessing the financial state of a telecommunications company involves more than just assessing its revenue. This high technology oriented industry has continuous technical development, requiring shorter spans of return on investment and complex depreciation adjustments.
1.1 Industry Overview
The telecommunications industry is in itself diversified to various product offerings. Usually, cellular telecommunications (mobile and satellite) and fixed line telecommunications (landline and internet) are the two identified categories. China Mobi.
Royal Vopak - Capital Markets Day - 2013 - Jack de KreijCompany Spotlight
Vopak provides a summary of its capital disciplined growth strategy:
[1] Vopak evaluates investment opportunities through a project funnel that assesses risk-return profiles. It considers factors like first-mover advantage, growth with key accounts, and strategic alliances.
[2] Investment types have different risk-return profiles. Growth projects with launching customers have higher returns but also higher risks. Contracted infrastructure like LNG and industrial terminals offer lower risks and returns.
[3] Vopak aims to balance its global terminal network through a mix of brownfield expansions, greenfield projects, and strategic alliances. This supports the company's goal of continued value creation through capital disciplined
This document provides an overview of The AES Corporation and contains forward-looking statements. It summarizes AES's business operations across four continents with 36 GW in operation and 6 GW under construction. It also outlines AES's value proposition, financial metrics, growth drivers through 2018 including a largely funded construction program, and capital allocation plans through 2018 that are expected to increase shareholder value.
Format for financial results for listed entities which have listed their deb...GAURAV KR SHARMA
1. The Securities and Exchange Board of India (SEBI) has issued guidelines on the format for financial results that listed entities must follow when publishing their half-yearly and annual financial results.
2. The guidelines mandate specific formats for different types of companies, including formats for companies other than banks/NBFCs, formats for banks/NBFCs, and an alternative format for some manufacturing, trading and service companies.
3. The formats include line items for income, expenditures, profits, reserves, ratios and other financial details. Limited review reports from auditors must also follow specified formats.
Mahindra and Mahindra (M&M) reported quarterly results that beat expectations. Net sales increased 19.2% year-over-year to Rs. 5,434 crore, supported by a 21% growth in core volumes. Operating performance and profit also exceeded forecasts due to better operating leverage and higher other income. EBITDA margins were 16.5%, ahead of estimates. Net profit grew 7.9% to Rs. 758 crore, driven by strong operating performance and higher other income. Overall, healthy volume growth and better cost management supported M&M's financial performance in the quarter.
Goodrich announced strong financial results for the second quarter of 2007, with net income per share increasing 53% and sales growth of 9% compared to the same period last year. Segment operating margins increased from 14% to 16%. Goodrich increased its full year 2007 outlook, with expected sales now between $6.5-6.6 billion and net income per share of $3.50-3.60, up from previous estimates. Goodrich signed a new long-term agreement with Boeing and saw continued growth across its business segments and market channels in the second quarter.
This document is General Dynamics' 2007 Annual Report. It provides an overview of the company's strong financial performance in 2007, with record sales, earnings, and backlog across all business segments. Specifically, it notes that net sales increased 13% to $27.2 billion, operating earnings increased 21% to $3.1 billion, and backlog reached a historic high of $46.8 billion. The report summarizes key achievements and growth drivers for each of the company's four business segments - Aerospace, Combat Systems, Marine Systems, and Information Systems and Technology. It also discusses the company's continued focus on operational improvements, cash generation, capital deployment strategies, and outlook for another productive year in 2008.
- Gama Aviation reported financial results for the full year 2020 that showed declines in revenue and earnings due to the impact of the COVID-19 pandemic on the aviation sector. However, the company maintained a strong cash position.
- Key operational highlights included new contracts in special missions and technology outsourcing, the sale of a US subsidiary, and continued customer service despite pandemic challenges.
- Financially, revenue declined 26% while adjusted EBIT swung to a loss, reflecting lower activity and impairments, though the second half showed stable underlying performance. Cash flow was strong.
- The company implemented a new strategic business unit structure in 2021 to focus on high-value markets and long-term customer partnerships for future growth
Crompton Greaves 3QFY15 performance remains a mixed bag; buyIndiaNotes.com
- Crompton Greaves' standalone business reported stable results for 3QFY15, with revenues down slightly and margins flat. However, the overseas business slipped to an operating loss due to legacy order costs.
- Total revenues were down 1.5% for standalone but up 8.4% in Euros for overseas. The overseas business reported an operating loss due to costs from executing a legacy order.
- Motilal Oswal maintains a "Buy" rating but cuts earnings estimates due to delays in overseas business turnaround. They forecast stronger standalone growth over the next two years despite near-term margin pressures.
This document provides an overview and summary of SBM Offshore's business and strategy. Some key points:
- SBM Offshore is a leading provider of floating production solutions to the offshore oil and gas industry. It has the largest leased FPSO fleet worldwide.
- The company's strategy is to focus on its core FPSO business and services where it has historically achieved good margins. This includes improving project selection and risk management.
- Emerging opportunities for growth include increasing demand for oil production from deep and ultra-deep waters. SBM Offshore believes its FPSO technology is well positioned for these complex projects.
- The document discusses various projects, recent contract awards, and key financial metrics to
- Gama Aviation reported revenue growth of 22.5% in the first half of 2019 to $121.8 million, with gross profit up 19.9% to $23.5 million. Net debt increased to $24.9 million from $2.9 million at the end of 2018.
- The Ground division performed strongly with revenue, gross profit, and adjusted EBIT growth, benefiting from good performance in the US and Europe. However, the Global Services division was impacted by the loss of two airline customers.
- While financial performance was in line with expectations, the net debt position increased due to strategic investment, working capital growth, and slower recovery of some trade receivables. The outlook for
This document provides an overview and summary of SBM Offshore's presentation at the Barclays Conference in September 2013. Some key points:
- SBM Offshore is a leading FPSO provider with 16 FPSOs currently in its lease fleet and over 160 years of FPSO experience.
- Emerging opportunities for FPSOs include remote discoveries favoring floating production, exponential technology demand, and potential for units producing over 100,000 bbl/day.
- SBM's strategy is to focus on core FPSO products and services to improve risk/reward balance and financial returns, through selective bidding, investment in technology, and strengthening local content.
- The outlook presented over 20 potential FPSO project
Doug Wilburne presented at the Bank of America Merrill Lynch Global Industrials & EU Autos Conference on March 15, 2016. He discussed Textron's commitment to future growth through investing organically and acquisitions. Key financial highlights included revenue down 3.3% but segment profit up 3.4% and EPS up 17.4%. Textron has capital available for value-creating acquisitions and opportunistic share buybacks.
Bruker Corporation reported financial results for Q1 2015 with revenues of $353.5 million, down 17% year-over-year due to currency impacts and divestitures. Non-GAAP earnings per share were $0.14, up 27% from $0.11 in Q1 2014, driven by restructuring initiatives and operational improvements. For full-year 2015, Bruker expects organic revenue growth of approximately 1% and over 100 basis points of non-GAAP operating margin expansion despite currency headwinds.
The document analyzes the financial statements of a steel company for the fiscal year 2015-2016. It finds that while the company's sales volume grew, revenues declined 14.12% due to oversupply and price cuts. Expenses like finance costs and R&D spending increased. Assets like tangible assets grew due to capital expenditures, while inventories and cash balances declined. The company faces legal contingencies that could significantly impact its financial position if resolved adversely.
L&T reported strong quarterly results that beat market expectations, with revenue growth of 32% and net profit growth of 94% over the previous quarter. However, annual order inflows declined 12% for the first time since 2008, missing guidance. While international markets like the Middle East offer growth opportunities, high inflation and a slowing domestic economy may pressure margins going forward. The analyst maintains a neutral outlook on L&T until further developments emerge.
The document provides an investor overview for Curtiss-Wright Corporation for the first quarter of 2016. Some key points:
- Curtiss-Wright is a global industrial company providing highly engineered products and services to aerospace, defense, and industrial markets, with $2.2 billion in estimated 2016 sales.
- The company has leadership positions in growing markets such as commercial aerospace, power generation, and defense.
- Financial goals include 3-5% organic sales growth, over 14% operating margin, and over 100% free cash flow conversion.
Curtiss-Wright First Quarter 2016 Financial Resultsq4curtisswright
The document provides an earnings conference call summary and outlook for Curtiss-Wright Corporation for 1Q 2016 and full year 2016. Some key points:
- 1Q 2016 EPS of $0.73, ahead of expectations, with lower costs and strong free cash flow of $61M. However, sales decreased 8% due to weaker industrial markets.
- Full year 2016 guidance expects sales growth of -1% to 1% with operating margin expansion to 14.0-14.2% through cost savings and improving defense and power markets.
- The outlook expects solid earnings growth of 7-11% and continued strong free cash flow of $290-310M through ongoing initiatives and AP1000 reactor component sales.
Barnes Group is an international industrial and aerospace manufacturer and services provider with two business segments: Industrial and Aerospace. The document provides an overview of Barnes Group, including its history dating back to 1857, key acquisitions and divestitures, end markets, strategic focus on driving profitable growth, and financial performance trends showing sales increasing 3-6% annually and adjusted operating margins expanding to a target of 16-17% by 2015.
UniCredit initiates coverage of Italian construction company CMC with a buy recommendation. CMC has expertise in complex tunneling projects which supports its international expansion. It focuses on lower-risk contracts which has led to steady profits. While Italy remains an important market, CMC is increasing its international backlog which reduces risk. Strong backlog provides revenue visibility, though profits remain dependent on a few large projects which is declining. Deleveraging is expected to continue.
This document summarizes Broadwind's 2014 earnings conference call. It discusses Broadwind's financial results for 2014, including improved sales and narrowed operating losses. It also provides an overview of the wind industry market conditions and Broadwind's priorities for 2015, which include growing sales, achieving profitability, and margin improvement through initiatives like restoring tower production capacity. The document contains forward-looking statements and disclaimers about the accuracy of industry data.
SKF reported strong financial results for the third quarter and first nine months of 2010, with record operating profits and margins. Sales and manufacturing levels increased significantly compared to the same periods in 2009. SKF also announced new, higher financial targets and the acquisition of Lincoln Industrial, a leading lubrication systems company, for $1 billion.
Contents1.0Background11.1 Industry Overview11.2 Financi.docxmaxinesmith73660
Contents
1.0 Background 1
1.1 Industry Overview 1
1.2 Financial Background 1
2.0 Analysis of Accounting Quality 2
2.1 Vodafone PLC 2
2.2 Zain 3
3.0Trend Analysis 3
3.1 Financial Position 3
3.2 Revenue 4
4.0 Profitability Analysis 5
4.1 Return on Capital Employed 5
4.2 Profitability at Operational level 5
4.3 Financial Leverage 6
4.4 Operating Spread 6
4.5 Second Level of Decomposition 7
4.5.1 Profit Margin 7
4.5.2 Asset Turnover 7
5.0 Industry Analysis 7
5.1 Vodafone 7
5.2 Zain 9
6.0 Conclusion 10
7.0 References 11
8.0 Appendix 12
Return on Capital Employed - Inter-firm comparison 13
First Level Inter-firm Analysis 13
Financial Leverage 14
Net Borrowing Cost 14
Operating Spread 14
Second Level Inter Firm Analysis 15
Asset turnover 16
Drivers of Profitability – Vodafone – European Market 17
Drivers of Profitability – Zain Telecom – GCC Market 19
List of Tables
Table 1:1 Trend Analysis - Vodafone – Abstract4
Table 1:2: Trend Analysis - Zain Telecom - Abstract4
Table 1:3: Income Trend Analysis - Vodafone - Abstract 4
Table 1:4 Income Trend Analysis - Zain – Abstract5
Table 1: 5 Return on Capital Employed - Vodafone vs. Zain5
Table 1:6 Return on Net Operating Assets - Vodafone vs. Zain6
Table 1:7 Financial Leverage: Vodafone vs. Zain6
Table 1: 8 Operating Spread - Vodafone vs. Zain 6
Table 1:9 Profit Margin - Vodafone vs. Zain7
Table 1: 10 Asset Turnover - Vodafone vs. Zain 7
Table1: 11 Industry Average - Vodafone vs. Europe8
Table 1:12 Industry Analysis - Zain vs. Gulf9
ii
1.0 Background
It is impossible to imagine modern society without mobile telecommunications given that three billion calls are made each day in the US alone (Romano, 2013), there are more than 6.8 billion mobile telecommunications subscribers worldwide, and today, 96.2 out of every 100 people are expected to have a mobile device (Mobi-thinking, 2013). If these figures are not astonishing enough, the number of mobile subscribers is likely to surpass the world’s population in 2014 (Pramis, 2013). A total of 1.9 billion cell phones were sold in 2012, and the number does not seem as though it will fall anytime soon; in fact, the number is likely to grow to 2.6 billion by 2016 (Mobi-thinking, 2013). In 2011 in the UK, the number of mobile calls surpassed landline calls (Lee, 2013). Vodafone Group is the second largest service provider in the world, with a 2013 revenue of more than £44 billion (Mobi-thinking, 2013). However, assessing the financial state of a telecommunications company involves more than just assessing its revenue. This high technology oriented industry has continuous technical development, requiring shorter spans of return on investment and complex depreciation adjustments.
1.1 Industry Overview
The telecommunications industry is in itself diversified to various product offerings. Usually, cellular telecommunications (mobile and satellite) and fixed line telecommunications (landline and internet) are the two identified categories. China Mobi.
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Voltas FY14: Products lead growth; Projects weigh on profits - Motilal Oswal
1. Satyam Agarwal (AgarwalS@MotilalOswal.com); +91 22 3982 5410
Amit Shah (Amit.Shah@MotilalOswal.com) / Nirav Vasa (Nirav.Vasa@MotilalOswal.com)
6 August 2014
Annual Report Update | Sector: Capital Goods
Voltas
CMP: INR199 TP: INR230 Buy
House in order; awaiting macro support
Products lead growth I Projects weigh on profits
We went through VOLT’s annual report for FY14. Our key takeaways:
Projects business restructured but legacy projects continue to haunt: The
Projects business continued to report EBIT losses for the third consecutive year,
as the pace of execution failed to pick up. However, curtailment of EBIT losses
at 1.5% of project revenues against 3.3% in FY12 could be a key positive in a
constrained environment. RIEL reported EBITDA breakeven but continued to
struggle with post tax losses, compelling VOLT to infuse capital in FY14.
NWC cycle contracts for standalone entity, remains stretched on consolidated
basis: VOLT’s net working capital (NWC) remained elevated on consolidated
basis at 53 days against 30 days in FY11. However, its NWC cycle reported sharp
improvement on standalone basis (NWC days down by 10 days on standalone
basis), supported by lower inventories (improvement of 4 days) and increase in
trade payables (higher by 4 days).
Maintains leadership position in Unitary Cooling segment: For FY14, the Room
AC division reported 7% volume growth. Overall, the Unitary Cooling division
reported 39% revenue growth. EBIT margins across the division expanded from
9% in FY13 to 12.5%, supported by favorable product mix and higher demand
from tier III & IV cities, which VOLT caters to through a pan India network of
~6,500 retailers. The Unitary Cooling division reported the highest margins in
FY14 at 12.5% from a low of 5.9% in FY09.
Rationalizing manpower to curtail fixed costs: VOLT’s manpower cost for FY14
declined 6% on a consolidated basis and 15% on a standalone basis. Employees
on its payroll continued to decrease for the third consecutive year in FY14, with
65% of its manpower being on contract basis. VOLT has been rationalizing
manpower to realign itself with current industry requirements.
Maintain Buy: VOLT trades at 19.3x FY16E of INR10.4 and 15.7x FY17E EPS of
INR12.8, and at an EV of 15.5x FY16E EBITDA and 12.2x FY17E EBITDA. Near-
term growth triggers are dormant, considering the tepid pace of project
execution across sectors. Profitability of the Projects division is also likely to be
under pressure, as VOLT is yet to complete legacy projects. The Unitary Cooling
division could be a major beneficiary of operating leverage once demand picks
up across room ACs and refrigeration boxes. We model 14% revenue CAGR and
26% PAT CAGR over FY15-17. We maintain Buy; our target price is INR230.
BSE Sensex S&P CNX
25,665 7,672
Stock Info
Bloomberg VOLT IN
Equity Shares (m) 330.9
52-Week Range (INR) 233/63
1, 6, 12 Rel. Per (%) -7/45/136
M.Cap. (INR b) 66.5
M.Cap. (USD b) 1.1
Financial Snapshot (INR Million)
Y/E March 2015E 2016E 2017E
Net Sales 54,528 62,461 70,987
EBITDA 3,285 4,036 4,982
Adj PAT 2,807 3,449 4,234
EPS (INR) 8.5 10.4 12.8
Growth (%) 20 23 23
BV/Sh. (INR) 61 68 77
RoE (%) 14.6 16.1 17.6
RoCE (%) 13.9 15.7 17.6
P/E (x) 23.7 19.3 15.7
P/BV (x) 3.3 2.9 2.6
Shareholding pattern % (Jun-14)
Jun-14 Mar-14 Jun-13
Promoter 30.3 30.3 30.2
DII 29.2 28.9 25.6
FII 18.6 18.1 18.1
Others 21.9 22.7 26.1
FII Includes depository receipts
Stock Performance (1-year)
Investors are advised to refer through disclosures made at the end of the Research Report.
2. Voltas
6 August 2014 2
Quotes from annual report
Projects business: For the projects business in particular, new investments were
few and far between, with some reliable sources reporting that capital outlays lingered at
the decade’s lowest levels. The pace of execution also posed challenges, leading to both
time and cost overruns that contributed to margin dilution in projects
The International Projects business continued to remain in the grip of recession, marked by
widespread delays in settlements and release of payments
.”
. In response, project specific task
forces have been constituted, with clear roles and responsibilities directed towards faster
completion and quick settlement of commercial entitlements. The drive towards speedy
closure of projects has yielded some results, but there is still much to be done.
Rohini Electricals: While it was a subdued year for the Water business and Rohini
Industrial Electricals Limited (RIEL), their integration under Domestic Projects Group (DPG)
has been completed
Sidra Medical & Research Centre Hospital: Due to significant upward revision
in the total estimated costs to complete a major project in Qatar, the Sidra Medical and
Research Centre Hospital (Onerous contract), the Company had in the previous years
accounted for the cost overruns in accordance with AS-7.
. However, RIEL continued to suffer losses on its low-margin ‘legacy’
orders, resulting in a further write-down of ` 20 crores in the value of the Company’s
investment.
Though the Sidra project is over
93% complete, additional costs to come have been estimated for the revised completion
date along with possible enhancement of revenue from variations/claims.
The final completion schedule and other terms are yet to be finalized between the Main
Contractor and the end Customer and could revise the Company’s current cost estimates
and entitlements
Room AC segment: Despite the early onset of monsoons as well as dampened
consumer sentiment,
.
the Room AC business (Primary
Responding to the increased demand in tier 2 and tier 3 towns, as well as the rise in rural
demand driven by good monsoons, the business enhanced its penetration, with
Market) reported growth of 6.5% as
against industry-wide AC sales de-growth of around 8%, as per internal estimates. In the
Secondary Market, the growth was 19% as against industry growth of 11% as per GFK-
Nielsen.”
the number
of touch points now exceeding 6500 outlets.
Textile machinery segment: The revised and restructured Textile Up gradation
Fund (TUF) scheme is yet to have the desired impact in boosting the demand and reviving
the fortunes of the Textile industry. The prevailing uncertainties and subdued investment
climate, coupled with Rupee devaluation and volatility, weakened sentiments and led to
postponement of equipment orders.
3. Voltas
6 August 2014 3
Projects segment awaits macro push for improved order booking
Legacy projects remain the major drag on VOLT’s Projects business. The company
continues to focus on execution of these projects, for which it has constituted an
internal task force with the intention to close these legacy projects. However,
closure of legacy projects has met with limited success, as clients continue to delay
payments, indirectly signaling their intention to delay commissioning.
Due to legacy projects and delays in project execution, revenues for FY14 declined
16% to INR26.9b, almost in line with the revenues booked in FY09. However, VOLT
was able to control its losses, effectively resulting in negative EBIT margin of 1.5%,
against negative 3.3% in FY12. Closure of legacy projects and improved pace of
project execution across recently bagged orders with higher margins and better
commercial terms hold the key to margin improvement in Projects business.
Project revenues dip under constrained environment
27,600
31,130
30,411
31,832 31,995
26,924
FY09 FY10 FY11 FY12 FY13 FY14
Revenues
Source: Company, MOSL
EBIT margins remain negative for third consecutive year
2,134
3,091
2,393
(1,042)
(491)
(396)
-5
0
5
10
15
(2,000)
(1,000)
-
1,000
2,000
3,000
4,000
FY09 FY10 FY11 FY12 FY13 FY14
EBIT EBIT (%)
Source: Company, MOSL
RIEL achieves EBITDA breakeven after three years
Supported by 29% increase in contract revenues, RIEL reported EBITDA breakeven in
FY14, with an operating profit of INR24.6m. However, interest cost of INR90.3m
continued to drag RIEL’s profitability. Consequently, it reported loss of INR69m. Post
the integration of RIEL with VOLT’s domestic projects group, VOLT had purchased
the remaining 16.33% share from RIEL’s erstwhile promoters, making RIEL its 100%
subsidiary. Improvement in RIEL’s performance is subject to improved pace of
project execution and closure of legacy orders. VOLT has invested INR370m via
preferential share allotment in RIEL.
RIEL turns EBITDA positive in FY14 but continues to report cash losses
(INR - Millions) FY10 FY11 FY12 FY13 FY14
Revenues 2,149 1,628 1,179 850 1,031
EBITDA 175 (300) (188) (47) 25
EBITDA (%) 8.2 (18.4) (15.9) (5.5) 2.4
PAT 93 (366) (262) (131) (69)
PAT (%) 4.3 (22.5) (22.2) (15.4) (6.7)
Source: Company, MOSL
4. Voltas
6 August 2014 4
INR370m invested in RIEL via preferential share allotment
250 250
620
FY12 FY13 FY14
VOLT's investment inRIEL via prefrence shares
Source: Company, MOSL
RIEL’s value in VOLT’s balance sheet
1,069 1,069
969
FY12 FY13 FY14
RIEL's value inVOLT's balance sheet
Source: Company, MOSL
NWC cycle contracts for standalone entity, remains stretched on
consolidated basis
Considering the constrained environment, characterized by tepid pace of project
execution, especially across GCC nations, VOLT’s net working capital (NWC)
remained elevated on consolidated basis at 53 days but have remained flat on YoY basis
against 30 days in FY11. However, its NWC cycle reported sharp improvement on
standalone basis (NWC days down by 10 days on standalone basis), supported by
lower inventories (improvement of 4 days) and increase in trade payables (higher by
4 days).
NWC remains at elevated levels on consolidated basis
No of days FY08 FY09 FY10 FY11 FY12 FY13 FY14
Inventories 42 35 50 58 59 65 62
Debtors 56 65 60 70 73 86 92
Unbilled Revenues 31 59 37 56 56 47 46
Retention Money 9 15 17 14 19 12 14
Loans and Advances (Excl Subs) 17 19 16 17 21 20 21
Trade Payables (73) (99) (85) (103) (105) (115) (115)
Customer Advances (56) (55) (54) (44) (35) (28) (32)
Current Liabilities (15) (12) (12) (15) (12) (14) (17)
Provisions (25) (22) (20) (22) (20) (18) (19)
Total (13) 5 8 30 56 53 53
Net Cash / Debt (INR m)
Cash and Cash Equivalents 3,002 4,571 4,689 4,890 2,710 3,498 2,818
Current Investments 2,273 1,244 2,090 2,247 2,233 2,680 5,927
Debt (737) (1,814) (352) (1,367) (2,214) (2,612) (2,629)
Net Cash / Debt 4,537 4,000 6,428 5,770 2,730 3,566 6,116
Source: Company, MOSL
5. Voltas
6 August 2014 5
NWC improves by 10 days for FY14 on standalone basis despite constrained environment
No. of days FY08 FY09 FY10 FY11 FY12 FY13 FY14
Inventories 41 33 49 54 53 55 51
Debtors 55 59 52 59 61 71 73
Unbilled Revenues 32 62 37 53 51 40 38
Retention Money 9 15 17 13 18 12 14
Loans and Advances (Excl Subs) 17 20 19 13 17 16 17
Trade Payables (74) (97) (80) (95) (97) (102) (106)
Customer Advances (57) (58) (57) (43) (32) (23) (25)
Current Liabilities (16) (9) (11) (14) (11) (13) (15)
Provisions (24) (22) (20) (21) (18) (17) (18)
Total (16) 2 6 20 43 39 29
Net Cash / Debt (INR m)
Cash and Cash Equivalents 2,752 4,002 4,029 4,251 2,054 2,586 2,085
Current Investments 2,211 1,215 2,034 2,179 2,213 2,680 5,927
Debt (477) (1,284) (191) (939) (1,778) (2,120) (1,934)
Net Cash / Debt 4,487 3,933 5,872 5,490 2,489 3,147 6,078
Source: Company, MOSL
Rationalizing manpower to curtail fixed costs
VOLT’s manpower cost for FY14 declined 6% on a consolidated basis and 15% on a
standalone basis. Employees on its payroll continued to decrease for the third
consecutive year in FY14, with 65% of its manpower being on contract basis. In all,
VOLT has 6,901 employees on its rolls, down from the peak of 11,527 employees in
FY11. VOLT has been rationalizing manpower to realign itself with current industry
requirements.
Staff cost increased to 11% of revenues from 9% in FY08
2,991
4,656
5,357
5,563
5,995
6,325
5,947
8
9
10
11
12
2,000
3,000
4,000
5,000
6,000
7,000
FY08 FY09 FY10 FY11 FY12 FY13 FY14
Staff Cost (INR - Millions) % of total revenues
Source: Company, MOSL
Employee count dips for third consecutive year in FY14
7378
9594
8608
11527
9994
8862
6901
3797
6228
5173
7771
7215
6246
4519
50
55
60
65
70
75
3500
5500
7500
9500
11500
FY08 FY09 FY10 FY11 FY12 FY13 FY14
Total Employees Contract employees
% of total employees
Source: Company, MOSL
TUF fails to support demand; near-term outlook remains grim
Demand for spindles and other spinning machines is likely to remain grim in the
near term, as the restructured Textile Upgradation Fund (TUF) has failed to provide
the desired stimulus for resumption of capex across the Indian textiles industry. The
Engineering Products & Services division reported 4% growth and 31% EBIT margin
in FY14. Overall, the division’s revenues are still 21% below peak levels of INR5.6b.
EBIT margins across the Engineering Products & Services segment expanded to
31.6% for FY14, supported by one-time gains worth INR125.4m from business
restructuring, which led to sale of its mining business.
6. Voltas
6 August 2014 6
Engineering product revenues up 4% YoY
5,420
4,680
5,638
4,121 4,311 4,482
FY09 FY10 FY11 FY12 FY13 FY14
Source: Company, MOSL
EBIT margin improvement supported by one-time gains
626
768
1,031
687
821
1,414
9
14
19
24
29
34
-
500
1,000
1,500
FY09 FY10 FY11 FY12 FY13 FY14
EBIT EBIT (%)
Source: Company, MOSL
Maintains leadership position in unitary cooling segment
VOLT maintains its leadership position across the Room AC industry. For FY14, the
Room AC division reported 7% volume growth. Overall, the Unitary Cooling division
reported 39% revenue growth. EBIT margins across the division expanded from 9%
in FY13 to 12.5%, supported by favorable product mix and higher demand from tier
III & IV cities, which VOLT caters to through a pan India network of ~6,500 retailers.
The Unitary Cooling division reported the highest margins in FY14 at 12.5% from a
low of 5.9% in FY09. Margin expansion is an outcome of sustained marketing efforts
towards institutional customers, product portfolio enhancement, focused
marketing, and expanding dealer network. To cater to increasing demand for room
ACs, VOLT has ramped-up its manufacturing capacity to 650k units per annum in its
manufacturing subsidiary, Universal Comfort Products (UPCL).
Revenue increases 2.2x in five years
9,200
11,860
15,608 15,388
18,356
20,524
FY09 FY10 FY11 FY12 FY13 FY14
Revenues
Source: Company, MOSL
EBIT margin expands from 6% in FY09 to 12.5% in FY14
550
1,203
1,599
1,298
1,655
2,567
6.0
10.1 10.2
8.4
9.0
12.5
4
6
8
10
12
14
-
500
1,000
1,500
2,000
2,500
3,000
FY09 FY10 FY11 FY12 FY13 FY14
EBIT EBIT (%)
Source: Company, MOSL
Valuation and outlook
VOLT trades at 19.3x FY16E of INR10.4 and 15.7x FY17E EPS of INR12.8, and at an EV
of 15.5x FY16E EBITDA and 12.2x FY17E EBITDA. Near-term growth triggers are
dormant, considering the tepid pace of project execution across sectors. Profitability
of the Projects division is also likely to be under pressure, as VOLT is yet to complete
legacy projects. The Unitary Cooling division could be a major beneficiary of
operating leverage once demand picks up across room ACs and refrigeration boxes.
We model 14% revenue CAGR and 26% PAT CAGR over FY15-17. We maintain Buy;
our target price is INR230.
10. Voltas
6 August 2014 10
Disclosures
This research report has been prepared by MOSt to provide information about the company(ies) and sector(s), if any, covered in the report and may be distributed by it and/or its affiliated company(ies). This
report is for personal information of the select recipient and does not construe to be any investment, legal or taxation advice to you. This research report does not constitute an offer, invitation or inducement
to invest in securities or other investments and Motilal Oswal Securities Limited (hereinafter referred as MOSt) is not soliciting any action based upon it. This report is not for public distribution and has been
furnished to you solely for your general information and should not be reproduced or redistributed to any other person in any form. This report does not constitute a personal recommendation or take into
account the particular investment objectives, financial situations, or needs of individual clients. Before acting on any advice or recommendation in this material, investors should consider whether it is suitable
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