Larsen & Toubro (L&T) has reported 27 per cent decline in net profit at Rs.2,069 crore for the fourth quarter ended March 31, 2015, compared to Rs.2,840 crore in the same period last year.
Net sales during the quarter went up by 4 per cent to Rs.28,022 crore from Rs.27,024 crore.
Order inflow during the quarter went up by 39 per cent to Rs.47,582 crore compared to Rs.34,220 crore in the same period last year.
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For the year ended March 31, 2015, the consolidated net profit was marginally lower at Rs.4,765 crore against Rs.4,902 crore in the previous year
This was mainly due to challenges faced during executions of international projects in the hydrocarbon sector.
“The infrastructure and services businesses of the group, however, recorded healthy increase in net profit, thereby limiting the year-on-year decline on overall net profit,” R. Shankar Raman, Chief Financial Officer, L&T said.
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“The net profit of the previous year included one-time write back of Rs.664 crore on account of amortisation charge of toll road projects. Neutralising this high base effect, the net profit for the year 2014-15 shows an increase,” he said adding that the profit for the fourth quarter was impacted due to the one-time write back.
For the year the company’s consolidated net sales revenue increased 8 per cent to Rs.92,762 crore and out of that international revenue was Rs.25,275 crore.
The board of directors has recommended a dividend of Rs.16.25 per equity share.
Commenting on the result, L&T Executive Chairman A.M. Naik said, “The infrastructure segment did exceedingly well. The overall situation with respect to margin has not deteriorated, though competitive pressure was very high. In 2014-15, we lost lot of money in the hydrocarbon business.”
He said in the current year, the road sector has taken off well. “In the infrastructure space, the road segment has already taken off. Last month eight tenders (EPC) were out and we bagged all of them. The government has plans to build 100 km road per day, and even if they can achieve 50 kms per day, it is huge volume,” Mr. Naik said.
“In the Public Private Partnership (IIP) segment, I don’t see any action. Going forward, 65 per cent of the roads will be constructed by the Government through EPC contracts and 35 per cent by the private sector provided investment can come from some other source,” Mr. Naik said.
He said now L&T has lowered the guidance for Middle East to 25 per cent and will focus more on India. In the hydrocarbon business it will concentrate more on the domestic market where gas pooling for the fertilizer sector has opened up several opportunities. On the guidance for 2015-16, he said the company is looking at 15 per cent improvement in revenue and order book.