Larsen & Toubro Limited · NSE:LT
Larsen & Toubro — Q3 FY2018 Earnings Presentation
31 slides from Larsen & Toubro's earnings presentation, Jan 31, 2018
Slide 1: Analyst Presentation Q3/9M FY18
1 Builders to the nation Analyst Presentation Q3/9M FY18 January 31, 2018
Slide 2: Disclaimer
2 Disclaimer This presentation contains certain forward time and cost over runs on contracts, our looking statements concerning L&T’s future ability to manage our international business prospects and business profitability, operations, government policies and actions which are subject to a number of
Slide 3: Presentation Outline
3 Presentation Outline Group Performance Highlights Group Performance Summary Segment / Key Subsidiaries The Environment & the Outlook
Slide 4: Performance Highlights – Q3 FY18
4 Performance Highlights – Q3 FY18 Order Order Book Inflow +5% +38% Revenue EBITDA (like-to-like) +25% +10% *PAT RONW (TTM) +48% 14.6% *excluding exceptionals
Slide 5: Key Financial Indicators
5 Key Financial Indicators Amount in ₹ bn Q3 Q3 9M 9M Var Particulars Var FY17 FY18 FY17 FY18 349 481 38% Order Inflow 957 1032 8% Order-Book 2586 2707 5% 261 287 10% Revenue from Operations (like-to-like) 727 790 9% 25 31 25% EBITDA 67 82 21% 9.4% 9.1% -24 bps EBITDA Margin (ex services) 8.0% 8.5%
Slide 6: Presentation Outline
6 Presentation Outline Group Performance Highlights Group Performance Summary Segment / Key Subsidiaries The Environment & the Outlook
Slide 7: Q3/9M FY18 Order Inflow/Order Book
7 Q3/9M FY18 Order Inflow/Order Book Amount in ₹ bn Order Inflow 481 1032 957 349 • Q3 witnessed strong project award activity • Shrinkage in international opportunity basket compensated by domestic market • Private sector capex (incl. Real Estate & building construction) Order Book still muted 9M F
Slide 8: Group Performance – Sales & Costs
8 Group Performance – Sales & Costs Q3 Q3 9M 9M % Var ` Billion % Var FY17 FY17 FY18 FY17 FY18 261 287 10% Revenue (like-to-like) 727 790 9% 1,100 37% 35% -2% International Revenue % 36% 35% -1% 34% 173 184 6% MCO Exp. 474 504 6% 727 13 15 15% Fin. Charge Opex* 40 44 10% 54 35 38 10% Staff Costs 104
Slide 9: Group Performance – EBITDA to PAT
9 Group Performance – EBITDA to PAT Q3 Q3 9M 9M % Var ` Billion % Var FY17 FY17 FY18 FY17 FY18 25 31 25% EBITDA 67 82 21% 111 • Services businesses (4) (4) -4% Fin. Cost (10) (11) 7% (13) contributes to EBITDA growth (7) (5) -37% Depreciation (16) (14) -13% (24) 3 2 -22% Other Income 10 10 -1% 13 •
Slide 10: Presentation Outline
10 Presentation Outline Group Performance Highlights Group Performance Summary Segment / Key Subsidiaries The Environment & the Outlook
Slide 11: Segment Composition
11 Segment Composition Infrastructure Power Heavy Electrical & Engineering Automation Buildings & Factories (B&F) EPC- Coal & Gas Electrical Standard Process Plant Equipment Products Transportation Infra (TI) Thermal Power Plant Nuclear Power Plant Electrical Systems Heavy Civil infra (HC) Construct
Slide 12: 9M FY18 Order Inflow/Order Book Break-up
12 9M FY18 Order Inflow/Order Book Break-up Hydrocarbon E&A 12% Services HE 4% 18% Order Inflow 4% Power ₹1032 Bn 2% Others 8% Infrastructure Power HE 52% 4% 5% E&A 1% Hydrocarbon 11% Others 5% Infrastructure 74% Order Book ₹2707 Bn
Slide 13: 9M FY18 Revenue Break-up
13 9M FY18 Revenue Break-up E&A Hydrocarbon IT & TS Fin. 10% Services HE 5% 10% 3% 9% Devl. Proj. 4% Power 6% Others 7% Infrastructure 46% 35% Revenue ₹792 Bn 65% Domestic International
Slide 14: Infrastructure Segment
14 Infrastructure Segment Amount in ` bn Net Revenue & EBITDA Margin • Revenue growth driven by WET, TI, HC and PT&D. • Pick up in domestic execution contributes to revenue growth • Margin reflects job mix and stage of completion
Slide 15: Power Segment
15 Power Segment Amount in ` bn Net Revenue & EBITDA Margin • Aggressive competition and limited opportunities impacts order inflow • Revenue decline reflects depleting domestic order book • Execution of International orders on track • Profits of MHPS and other JV companies are consolidated at PAT l
Slide 16: Heavy Engineering Segment
16 Heavy Engineering Segment Amount in ` bn Net Revenue & EBITDA Margin • Revenue growth mainly obtained from defence business • International revenues impacted by lower PPN order book • Short term margin fluctuation due to job execution pattern
Slide 17: Electrical & Automation Segment
17 Electrical & Automation Segment Amount in ` bn Net Revenue & EBITDA Margin • Like-to-like Q3 Revenue growth mainly accrued from Products business • Product mix and operational efficiencies lead to margin improvement
Slide 18: Hydrocarbon Segment
18 Hydrocarbon Segment Amount in ` bn Net Revenue & EBITDA Margin • Strong domestic ordering activity witnessed in Q3 (offshore and onshore) • Revenue growth on efficient execution of international order book • Margin expansion due to job progress and cost optimisation
Slide 19: Developmental Projects Segment
19 Developmental Projects Segment Amount in ` bn Net Revenue & EBITDA Margin • Segment includes Power Development, Hyderabad Metro and Kattupalli Port • IDPL (Roads & TL) consolidated at PAT level under Equity method • Partial CoD of 30Km stretch in Hyderabad Metro • Revenues and margins of Nabha Po
Slide 20: IT & Technology Services Segment
20 IT & Technology Services Segment Amount in ` bn Net Revenue & EBITDA Margin • Digital services driving growth for both the subsidiaries • LTI revenue growth led by BFS, Energy & Utilities and CPG, Retail & Pharma Verticals • LTTS revenue growth led by Telecom & Hi-Tech, Transportation and Medical
Slide 21: Others Segment
21 Others Segment Amount in ` bn Net Revenue & EBITDA Margin • Segment includes Metallurgical & Material Handling (MMH), Industrial Products & Machinery (IPM). Realty and Shipbuilding (SHBD) businesses • Revenues affected by lower industrial offtake (CE&O and Valves), slowdown in Realty sector and d
Slide 22: L&T Finance Holdings (I-GAAP)
22 L&T Finance Holdings (I-GAAP) Q3 Q3 9M 9M % Var ` Bn % Var FY17 FY18 FY17 FY18 21.6 27.0 25% Total Income 63.3 75.6 19% PAT attributable to Equity 2.4 3.6 48% 6.3 9.7 53% Shareholders Mutual Fund Average AUM 351.9 603.1 71% Loan Book 619.7 759.6 23% Net NPA (%) 7.3% 2.9% -443 bps Networth 77.1 92
Slide 23: Presentation Outline
23 Presentation Outline Group Performance Highlights Group Performance Summary Segment / Key Subsidiaries The Environment & the Outlook
Slide 24: The Environment & the Outlook
24 The Environment & the Outlook Public Sector Budgetary Productivity Spends Value Monetisation Allocations Competition Robust Inflows Tax Revenues Operational excellence Bharatmala / Domestic Market Efficient execution Growth Infra thrust Margin improvement Payments & Payouts Private Sector Clearan
Slide 25: Thank You
25 Thank You RENTS | veut 5 © LARSEN & TOUBRO
Slide 26: Annexures
26 Annexures RENTS | veut 5 © LARSEN & TOUBRO
Slide 27: Group Profit & Loss Extracts
27 Group Profit & Loss Extracts L&T & L&T Group Fin. Devl. ` Billion IT & TS Others (Incl. Services Projects 9M FY18 9M FY17 % Var Eliminations) Income from Operations* 81.1 73.4 30.8 606.5 791.8 731.8 8% EBITDA 16.5 8.9 4.4 52.0 81.8 67.5 21% Other Income 1.0 1.8 0.1 7.0 9.8 9.9 -1% Interest Expens
Slide 28: Balance Sheet
28 Balance Sheet Incr / ` Billion Dec-17 Mar-17 (Decr) Equity & Reserves 524 502 22 Non Controlling Interest 43 36 7 Borrowings - Financial Services 721 631 90 Development Projects 172 150 22 Others 208 159 49 Sources of Funds 1,668 1,478 191 Fixed Assets 127 132 (5) Intangible Assets (incl. Investm
Slide 29: Group Cash Flow
29 Group Cash Flow Q3 9M Q3 9M ` Billion FY17 FY17 FY18 FY18 25.6 68.9 Operating Profit 31.7 83.5 16.5 15.3 Changes in Working Capital (23.9) (46.0) (9.5) (25.4) Direct Taxes paid (8.0) (25.3) 32.6 58.9 Net Cash from Operations (A) (0.1) 12.2 (6.0) (21.3) Net Investment in Fixed Assets (incl. Intang
Slide 30: Share in Profit/(Loss) of JVs/Associates
30 Share in Profit/(Loss) of JVs/Associates Q3 9M Q3 9M ` Bn FY17 FY17 FY18 FY18 0.18 0.77 MHPS JVs 0.35 1.11 (1.14) (4.08) IDPL & Subs. (1.45) (2.79) (0.49) (1.40) Special Steels and Heavy Forgings (0.78) (1.79) (0.03) (0.07) Others 0.18 0.27 (1.48) (4.79) Total (1.71) (3.19)
Slide 31: Concessions Business Portfolio – 21 SPVs
31 Concessions Business Portfolio – 21 SPVs Transmission Lines: Portfolio: 1 project (482 Km) - Operational Roads and Bridges: Project Cost: `15 bn Portfolio: 15 projects (1661 Km) 14 Operational Project Cost: ` 161 bn Balance Equity Commitment (Dec 2017): ` 11 Bn Equity Invested at SPV level (Dec 2