Mumbai, July 28, 2008: Backed by a healthy order book, Larsen & Toubro
Limited reported impressive financials for the quarter ended June 30, 2008. The
Gross Sales at Rs. 6993 crore grew by 53% over the corresponding quarter of
the previous year. The growth trend witnessed in the last fiscal in Order Inflow,
continued during the first quarter of 08-09 with a rise of 24% over the
corresponding quarter of the previous year. The Company’s leadership position
and superior capability have aided in garnering fresh orders across its
manufacturing, engineering and construction sectors.
Efficiency in project execution and effective cost management have enabled the
Company to report good growth in profitability. Segment profitability has
improved during the quarter in line with the higher margins realized on the
company’s major business lines. Profit after Tax (PAT) for the quarter at Rs. 502
crore, grew by 33% over the corresponding quarter of the previous year. The
Company reported significant foreign exchange gain during the first quarter of the
previous year. Excluding the incidence of such exchange gain, the net profit for
the quarter grew by a robust 70% year-on-year basis.
Engineering & Construction (E&C) Segment
The E&C segment reported healthy growth in its Order Inflows during the quarter
at Rs. 10516 crore registering an increase of 28% over the corresponding quarter
of the previous year. The share of international orders booked during the quarter
was 13% of the segment’s total Order Inflow.
E&C segment sales for the quarter ended June 30, 2008 at Rs. 5545 crore grew
by 59% when compared with the corresponding quarter of the previous year. The
share of export revenue represented 19% of the quarter’s segment revenue.
Astute contract management, a sound risk evaluation framework at all stages of
project life cycle, strict adherence to quality and delivery deadlines and
continuous cost optimization in executing large turnkey projects have enabled
E&C Segment improve its operating margins to 10.5% during the quarter,
compared to 9.6% of the corresponding quarter of the previous year.
As at the end of the quarter, the Segment’s Order Book stood at Rs. 56336 crore.
International Order Book at Rs. 9058 crore represents 16% of the segment’s
The details of the major orders secured during the quarter are given in the
Electrical & Electronics Segment
The segment reported a modest growth in its Order Inflows and Sales, despite
the sluggish demand prevailing during the quarter. The segment sales revenue at
Rs. 578 crore for the quarter increased by 7% when compared with the
corresponding quarter of the previous year. Export revenues constitute 12% of
the segment revenues for the quarter. Spurt in input cost coupled with lower
sales volume and competitive pressures have resulted in lower operating
margins for the quarter.
Machinery & Industrial Products Segment
The segment achieved gross sales of Rs. 634 crore during the quarter,
registering a healthy increase of 50% over the corresponding quarter of the
previous year. The segment realized higher operating margins for the quarter
due to improved performance by Valves, Industrial Machinery and Welding
Systems businesses. Construction & Mining Equipment business continued to
perform well during the current quarter.
The robust order book of the Company provides healthy sales growth visibility
over the next one to two years. Considering the importance of sustaining
investments in critical sectors like infrastructure, power, hydrocarbon etc., the
Company is optimistic of achieving growth in order inflows in the near to medium
term. The Company will continue to look out for investment in growth enhancing
opportunities. The Company’s focus on strategies and measures to counter
inflation and changing economic conditions are expected to help sustain the
profitability of its various businesses.
UNAUDITED STAND-ALONE FINANCIAL RESULTS FOR THE QUARTER ENDED JUNE 30 , 2008
Segment-wise Revenue, Result and Capital Employed
in terms of Clause 41 of the listing agreement