Engineering conglomerate Larsen & Toubro reported a net profit of Rs 5,520 crore for the September quarter — a number aided by one-time asset sale proceeds, but offset by impairment costs.
The firm also announced a special dividend of Rs 18 per share. In its management commentary, L&T refused to share a guidance for revenue or order inflow, citing Covid-related uncertainty.
The firm reported a consolidated profit after tax (PAT), including the PAT from discontinued operations for the quarter, at Rs 5,520 crore, against Rs 2,527.26 crore reported a year ago. The number is helped by Rs 8,146 crore as net profit from discontinued operations, referring to the sale of its electricals and automation business to Schneider Electric in August.
The company also reassessed value for a couple of its assets, including a nuclear-related joint venture and power plants, and took a one-time pre-tax impairment hit of Rs 3,918.50 crore.
For Q2, L&T reported gross revenue of Rs 31,035 crore, down 12 per cent on a year-on-year (YoY) basis. Top executives said the impact of the June quarter lingered over the first half financial year performance, and it would take another couple of quarters to regain lost ground.
L&T bagged new orders worth Rs 28,039 crore in the quarter under review and saw a 19 per cent sequential improvement. On a YoY basis, order inflow was down 42 per cent. L&T’s outstanding order book as of September was at Rs 2.98 trillion, with international order book constituting 24 per cent to the order book.
S N Subrahmanyan, managing director and CEO, said: “Private capital expenditure is still another two years away. We will see some investments, but it will be scarce.”
The net profit after tax and share in profit/(loss) of joint ventures/associates from continuing operations before exceptional items, which painted a fairer picture of the regular operations for the September quarter, was Rs 1,410 crore.
It said the impact of the pandemic in terms of lower revenue, higher credit provisions in the financial services business, and disruption of metro services led to a decline of 45 per cent from Rs 2,552 crore reported in the same period a year ago.
L&T also completed the sale of its electricals and automation business to Schneider in August.
On Wednesday, the company declared a special dividend of Rs 18 per equity share to mark the successful completion of the divestment. Debt reduction has commenced; debt is now at Rs 1.46 trillion, lower from Rs 1.55 trillion a quarter ago. Business Standard