Larsen & Toubro Limited · NSE:LT
Larsen & Toubro — FY2007 Earnings Presentation
39 slides from Larsen & Toubro's earnings presentation, May 29, 2007
Slide 1: Analyst Presentation FY 07
Analyst Presentation FY 07 29th May, 2007 It’s all about Imagineering 1
Slide 2: Safe Harbor
Safe Harbor This presentation contains certain forward looking statements concerning L&T’s future business prospects and business profitability, which are subject to a number of risks and uncertainties and the actual results could materially differ from those in such forward looking statements. The
Slide 3: Presentation Outline
Presentation Outline L&T Standalone Performance Highlights Segment Analysis Group Performance Consolidated Financials Key Initiatives & Outlook 29th May, 2007 It’s all about Imagineering 3
Slide 4: Performance Highlights
Performance Highlights 29th May, 2007 It’s all about Imagineering 4
Slide 5: Performance Highpoints
Performance Highpoints Strong performance across businesses Consistent flow of Order Inflows through the year Healthy Sales growth Significant increase in Order Book Robust growth in EBITDA margins & profits led by E&C segment Growth in Recurring PAT by 60%; EPS: Rs 50.22 ROCE (Recurring) at 20.2% (
Slide 6: Good All Round Performance
Good All Round Performance Order Inflows Net Sales 350 306.02 16% 300 R 4 3% 200 CAGR 175.79 G 223.70 147.35 250 CA 131.16 150 200 149.42 400 237 3 57 320 150 100 240 160 80 - 100 9M 06 9M 07 50 50 0 0 FY 05 FY 06 FY 07 FY 05 FY 06 FY 07 Order Book Recurring PAT 368.82 13.85 48% 400 R 44% 14 R 350 G
Slide 7: Sectorwise Order Inflows
Sectorwise Order Inflows Rs Bn 149 224 306 100% 22 24 17 80% 60% 30 30 42 40% 15 10 12 20% 19 26 15 14 10 14 0% FY 05 FY 06 FY 07 Process Oil & Gas Power Infrastructure Others • Refineries • Platforms •Generation • Roads , Bridges • Ship Building • Petrochemicals • Pipelines •Renovation & • Ports ,
Slide 8: Sectorwise Order Book
Sectorwise Order Book Rs Bn 177 249 369 100% 13 17 14 80% 31 30 39 60% 40% 23 17 16 20% 19 25 19 14 11 12 0% FY 05 FY 06 FY 07 Process Oil & Gas Power Infrastructure Others • Refineries • Platforms •Generation • Roads , Bridges • Ship Building • Petrochemicals • Pipelines •Renovation & • Ports , Air
Slide 9: Independent Financial Statement
Independent Financial Statement 29th May, 2007 It’s all about Imagineering 9
Slide 10: Performance Summary
Performance Summary Q4 07 Q4 06 % Change Rs. Billion FY 07 FY 06 % Change 76.58 61.35 25% Order Inflows 306.02 223.70 37% Order Book 368.82 248.57 48% 62.48 46.17 35% Net Sales 175.79 147.35 19% Other Income 1.62 0.98 ‐ Operating / Recurring 3.20 2.26 0.42 0.67 ‐ Others* 1.42 2.38 64.52 47.82 35% To
Slide 11: Performance Summary
Performance Summary Q4 07 Q4 06 % Change Rs. Billion FY 07 FY 06 % Change 10.14 6.94 46% PBDIT (w/o gain on divestitures) 21.86 14.25 53% 15.7% 14.5% PBDIT/ Net Revenue 12.1% 9.4% 0.06 0.28 Interest 0.34 0.75 0.70 0.32 Depreciation 1.70 1.15 9.38 6.34 PBT (w/o gain on divestitures) 19.82 12.35 2.37
Slide 12: Balance Sheet
Balance Sheet Increase / Rs. Billion Mar‐07 Mar‐06 (Decrease) Net Worth 57.58 46.18 11.40 Loan Funds 20.78 14.54 6.24 Deferred Tax Liabilities (Net) 0.41 0.78 (0.37) Total Sources 78.77 61.50 17.27 Net Fixed Assets 22.25 16.05 6.20 Investments 31.07 19.20 11.87 Net Current Assets 25.45 26.25 (0.80)
Slide 13: Segment Analysis
Segment Analysis 29th May, 2007 It’s all about Imagineering 13
Slide 14: Segmental Net Revenues & EBITDA
Segmental Net Revenues & EBITDA MIP Others 5% (4%) E&C 10% (10%) Electrical & 75% (77%) Electronics NET REVENUES 10% (9%) Others MIP 4% (4%) E&C Electrical & 15% (15%) 67% (64%) Electronics 14% (17%) EBITDA Previous Year figures are indicated in brackets 29th May, 2007 It’s all about Imagineering 14
Slide 15: Continuous Improvement in Segmental EBITDA Margins
Continuous Improvement in Segmental EBITDA Margins 20.0 18.0 16.7 17.3 EBITDA Margins in percentage 16.0 14.7 13.7 11.5 11.9 12.0 10.3 9.5 10.1 8.0 7.1 8.0 4.0 0.0 E&C Electrical & MIP Others Electronics FY 05 FY 06 FY 07 29th May, 2007 It’s all about Imagineering 15
Slide 16: 'E&C' Segment
‘E&C’ Segment Q4 07 Q4 06 % Ch an ge Rs. Billion FY 07 FY 06 % Ch an ge Order Inflo ws : 44.43 44.82 Do mestic 206.27 151.05 16.78 6.67 Expo rt 46.22 33.75 61.21 51.49 19% To tal Order Inflo ws 252.49 184.80 37% Order Bo o k 353.33 238.58 48% Net Revenues: 41.05 30.40 Do mestic 107.62 92.88 7.10 5.4
Slide 17: 'Electrical & Electronics' Segment
‘Electrical & Electronics’ Segment Q4 07 Q4 06 % Change Rs. Billion FY 07 FY 06 % Change 5.20 3.73 Domestic Sales 16.75 12.46 0.66 0.44 Exports 1.70 1.40 5.86 4.17 41% Total Net Revenues 18.45 13.86 33% 0.99 0.72 38% EBITDA 3.19 2.31 38% 16.9% 17.3% EBITDA Margins 17.3% 16.7% Net Segment Assets 7.10
Slide 18: 'MIP' Segment
‘MIP’ Segment Q4 07 Q4 06 % Change Rs. Billion FY 07 FY 06 % Change 4.50 3.26 Domestic Sales 13.23 10.71 1.92 1.16 Exports 4.72 3.68 6.42 4.42 45% Total Net Revenues 17.95 14.39 25% 1.40 0.76 84% EBITDA 3.23 2.11 53% 21.8% 17.2% EBITDA Margins 18.0% 14.7% Net Segment Assets 3.12 2.10 To tal Net Reve
Slide 19: 'Others' Segment
‘Others’ Segment Q4 07 Q4 06 % Change Rs. Billion FY 07 FY 06 % Change 1.94 1.53 Domestic Sales 7.08 5.17 0.37 0.25 Exports 1.36 0.76 2.31 1.78 30% Total Net Revenues 8.44 5.93 42% 0.29 0.31 EBITDA 0.87 0.60 45% 12.6% 17.4% EBITDA Margins 10.3% 10.1% Net Segment Assets 1.94 1.88 Total Net Revenue ex
Slide 20: L&T Group Performance
L&T Group Performance 29th May, 2007 It’s all about Imagineering 20
Slide 21: Subsidiaries & Associates Portfolio
Subsidiaries & Associates Portfolio Infrastructure Projects IT Services Domestic Services Financial Services Manufacturing Engineering L&T Services Power International 29th May, 2007 It’s all about Imagineering 21
Slide 22: Infrastructure Projects
Infrastructure Projects Roads and Bridges Ports Portfolio: 9 projects Portfolio: 3 projects • 3 operational, 6 under implementation • 2 operational and 1 under implementation • Development: 1480 lane km. • Capacity: 33 mn. TPA • Project Outlay: Rs. 43 Bn • Project Outlay: Rs. 30 Bn Total no. of Proj
Slide 23: International Business – Focus Countries
International Business – Focus Countries Hydrocarbons & L&T International Sourcing & Global Infrastructure FZE Manufacturing Middle East China Saudi Qatar UAE Oman Kuwait Arabia L&T (Wuxi) Electric Co. Ltd. L&T Qatar L&T Readymix L&T Kuwait (100%) LLC (49%) Concrete Construction Co. L&T (Jiangsu) In
Slide 24: Performance of Subsidiaries
Performance of Subsidiaries Total Net Revenues Profit After Tax PAT Margins Rs Billion FY 07 FY 06 FY 07 FY 06 FY 07 FY 06 Services* 16.37 9.93 2.19 1.02 13.4% 10.3% Manufacturing 1.04 0.77 0.13 0.05 12.8% 7.1% Power 2.10 2.60 0.78 1.24 37.3% 47.8% Infrastructure# 1.35 0.61 0.27 0.15 19.8% 23.7% Pro
Slide 25: L&T Infotech Limited
L&T Infotech Limited Rs. Billion FY 07 FY 06 % Change Total Revenues 12.81 7.98 60% PAT 1.51 0.70 115% PAT / Total Revenues (%) 11.8% 8.8% 9 Consecutive years of robust growth 9 New clients added: 79 9 73% of the Total Revenues from USA & 14% from Europe 9 Additional centres at Mumbai, Bangalore & C
Slide 26: L&T Finance Limited
L&T Finance Limited Rs. Billion FY 07 FY 06 % Change Total Revenues 2.75 1.49 85% PAT 0.63 0.35 78% PAT / Total Revenues (%) 22.7% 23.6% Total Asse ts 29.22 13.46 9 Major growth in disbursements across its key business segments viz. Corporate Finance, Construction Equipment, Tractor and Commercial V
Slide 27: Performance of Associates
Performance of Associates Total Net Revenues Profit After Tax PAT Margins Rs Billion FY 07 FY 06 FY 07 FY 06 FY 07 FY 06 Engineering Services 1.25 0.76 0.24 0.11 19.0% 14.9% Manufacturing 20.68 14.75 1.51 1.02 7.3% 6.9% Infrastructure Companies 1.71 1.73 0.36 0.37 21.2% 21.5% Total (B) 23.64 17.24 2
Slide 28: Consolidated Financials
Consolidated Financials 29th May, 2007 It’s all about Imagineering 28
Slide 29: Consolidated Performance
Consolidated Performance Rs. Billion FY 07 FY 06 % Change Total Net Revenues 213.42 170.19 25% PBDIT (w/o gain on divestitures) 29.09 18.46 58% PBT (w/o gain on divestitures) 25.10 14.72 Tax ‐ (Incl Deferred, FBT & Dividend Tax) 7.15 4.47 PAT (w/o gain on divestitures ) 17.96 10.25 Share of profits
Slide 30: Consolidated Balance Sheet
Consolidated Balance Sheet L&T L&T Group FY 07 Rs Billion FY 07 FY 06 Increase / Decrease 57.58 Net Worth 69.03 49.40 19.63 ‐ Minority Interest 6.46 1.07 5.39 20.78 Loan Funds 64.32 34.99 29.33 0.41 Deferred Tax Liabilities (Net) 1.07 1.27 (0.20) 78.77 Total Sources 140.88 86.73 54.15 22.25 Net Fixe
Slide 31: Key Initiatives & Outlook
Key Initiatives & Outlook 29th May, 2007 It’s all about Imagineering 31
Slide 32: Prime Movers
Key initiatives People Technology Prime Movers Capacity Expansions New Ventures 29th May, 2007 It’s all about Imagineering 32
Slide 33: Outlook
Outlook Indian economy firmly on accelerated growth path Increasing opportunities in Middle East L&T’s leadership position in India in its businesses and growing International footprints Further strengthened by Strategic capacity expansions Focus on talent management Robust Financial con
Slide 34: Q&A Session
Thank You One of the world’s largest FCC Regenerators & Combustors built by L&T’s Heavy Engineering Division. Project completed six weeks ahead of schedule. Dimensions: 16.3 metres diameter 40 metres length 1320 MT weight Q&A Session 29th May, 2007 It’s all about Imagineering 34
Slide 35: Major Order Inflows during FY: Hydrocarbons Infrastructure
Major Order Inflows during FY 07 (Annexure 1) Hydrocarbons Infrastructure Cracker heater and associated Expansion & modernisation units for Naphtha Cracker of Delhi International Airport: project for IOCL: Rs 9.13 Bn Rs 55.6 Bn Offshore Platform project for EPC contract for Dhamra Port Maers
Slide 36: Major Order Inflows during FY: Power Others
Major Order Inflows during FY 07 (Annexure 1 contd.) Power Others Captive power plant for Blast Furnace and civil IOCL’s Naphtha cracker works at Vizag steel plant project: Rs 11.4 Bn for RINL: Rs 7.7 Bn Supply and installation of Six RO‐RO / LO‐LO Heavy Lift Nos 33/11 KV package Container C
Slide 37: Details of Other Income (Annexure 2)
Details of Other Income (Annexure 2) Rs. Million FY 07 FY 06 Hire Income from plant & machinery 121 27 Commercial leadership fees / Profit from IJVs 83 113 Technical Fees 149 152 Other Operational Income 353 292 Miscellaneous Income 2,052 1,158 Dividend from Subsidiaries 417 672 Dividend from Associ
Slide 38: PBDIT Computation (Annexure 3)
PBDIT Computation (Annexure 3) Rs Billion FY 07 FY 06 PBT before extraordinary but incl. gain dives titures ( as per s tatutory advt.)# 20.05 13.14 Add : Depreciation (as per s tatutory advt.) 1.70 1.15 Add : Interes t (as per s tatutory advt.) 0.34 0.75 Subtotal (A) 22.09 15.04 Les s Dives titure g
Slide 39: Infrastructure Projects (Annexure 4)
Infrastructure Projects (Annexure 4) L&T IDPL Transportation Urban Infrastructure (L&T‐UIL) Key Projects & Project Cost Rs Bn Key Projects & Project Cost Rs Bn Operational: Operational: Narmada Infrastructure Co. Ltd. (100% with L&T) 1.42 L&T Infocity Ltd. (89%) 1.82 L&T Transportation Infra. Ltd. (