Premier Announces Subdued Q4FY13 Results

Premier announced its March 2013 quarter results where it witnessed some slowdown in both its segments - engineering and automotive. The result was on expected lines as the management had itself stated that with an overall slowdown in the economy (especially the automobile sector), the engineering segment was expected to take a dip in terms of new orders. In the automotive segment, the decline was expected with sales figures witnessing a slowdown. 

If we take a look at the financial performance of the company for the March 2013 quarter, it posted a topline of Rs 49.52 crore as against Rs 79.49 crore in March 2012. The performance is not up to the mark on a QoQ basis as the topline is lower than Rs 60.09 crore posted in December 2012 quarter. 

However, the performance at the PBIT improved slightly as the PBIT stood at Rs 14.49 crore for the March 2013 quarter as against Rs 13.28 crore in March 2012. It was, however, lower as compared to Rs 18.21 crore posted in December 2012. 

The performance at the bottomline was boosted by the other income of Rs 307.49 crore. The profit was made from the sale of 150 acres of land at Dombivali for a consideration of Rs 440 crore to Horizon Projects, a part of the Mumbai-based Runwal group. The company has already received a part payment of Rs 220 crore and the rest will be received by December 2014. The company still holds another 78 acres of land here. 

The company has also made certain other adjustments. As a product rationalisation strategy, a comprehensive review was carried out of all business segments and various product development expenses during the year. The outcome of the review has resulted in writing off Rs 126 crore during the quarter (reflected under exceptional items) in line with the Accounting Standard 26. Apart from this, the company has also paid Rs 49.28 crore to the excise department pursuant to a long pending dispute. 

As a result, after considering the tax expenses of Rs 26.17 crore and deferred tax of Rs 33.70 crore the bottomline for the March 2013 quarter stands at Rs 70.91 crore. 

On a yearly basis, the topline for FY13 strands at Rs 246.60 crore as against Rs 270.28 crore in FY12. On the bottomline front, the net profit for FY13 stands at Rs 87.65 crore against Rs 22.84 crore in FY12. Again these figures are adjusted for an exceptional other income of Rs 307.49 crore and exception expenses of Rs 175.29 crore. The company has announced a dividend of Rs 7 per share resulting in a dividend yield of 9 per cent. 

However, investors should not get disheartened as the company has huge plans of expansion from the amount it has received through the sale of land. We will update our investors once the company announces its plans.