Adani Enterprises posts 40.5% dip in Q3 net

Standalone income rose by 174.79% at Rs 3,301 cr for Q3

Adani Enterprises Ltd (AEL), the flagship company of the Adani Group, reported considerable decline of 40.5% in its net profit for the third quarter ended December 31, 2012 on standalone basis.

AEL's net profit on standalone basis stood at Rs 29.85 crore, down by 40.5% from Rs 50.24 crore for the corresponding period in previous financial year 2011-12. However, AEL's standalone income, rose by 174.79% at Rs 3,301 crore for Q3 of FY '13, up from Rs 1201.31 crore in corresponding period last year.

On consolidated basis, AEL's net profit saw a marginal rise of mere 2% at Rs 416 crore in the third quarter ended December 31, 2012 compared to Rs 407 crore in same period last year. AEL's consolidated business includes coal trading, port and power generation & transmission verticals.

The consolidated total income for Q3 FY12, however, rose by 51% to Rs 13,649 crore against Rs 9,039 crore of Q3 FY '12. The consolidated EBIDTA increased by 35% to Rs 2,106 crore against Rs 1,555 crore in the corresponding quarter last year, driven by higher contribution from the port business and coal trading.

"Our overall performance has been good with substantial contribution from coal trading and ports which have offset the continuing downward pressure from the power business. We strongly believe that in the ensuing quarters the power business will get revived as the larger sectoral issues of coal linkages, power evacuation & tariff revisions are suitably addressed, ensuring investment sustainability," said Devang Desai, CFO Adani Group and Executive Director, Adani Enterprises.

As reported earlier, in order to focus on the high growth Indian ports and logistics sector and maintain its leadership position in India, the board of Adani Ports and Special Economic Zone Limited (APSEZ) has in-principle decided to divest a significant stake in entities controlling the Abbot Point Coal Terminal in Queensland, Australia to the Adani family, subject to requisite approvals, formalities and clearances, at a valuation determined by an independent valuer.

This divestment will further enhance the financial strength of APSEZ in order to pursue its plans to acquire or set up new ports & logistics assets in India.

Commenting on the results, Gautam Adani, Chairman Adani Group, said, "Our overall performance is expected to improve substantially as the additional capacities get operational & the much awaited power sector measures are implemented. We are committed to nurture a resilient business model focusing on the core sectors of Resources, Logistics & Energy and continue to leverage on our strengths of empowered & talented teams, process driven culture and a strong ethos of courage, trust & commitment. We will be at the forefront in building the nation’s, infrastructure and improving the community well being."

For the nine months period ended December 31, 2012 in the current fiscal, AEL's consolidated net profit also dipped by 25% at Rs 1139 crore as compared to Rs 1530 crore in the same period last year. AEL's consolidated total income for nine months rose by 22% to Rs 34,950 crore, as against Rs 28,719 crore for the corresponding period last year. The consolidated EBIDTA for nine month increased by 17% to Rs 4,990 crore against Rs 4,265 crore in the corresponding period last year. The consolidated net profit stood at Rs 1,139 crore in the nine month ended December 31, 2012 compared to Rs 1,530 crore in same period last year.

Meanwhile, in its mine development and operations business for Parsa Kente block in Chhattisgarh, AEL has been granted 'consent to operate' by Chhattisgarh Environment Conservation Board, following which it has started the work for extraction of coal and will start the supply of coal in the subsequent quarter.

AEL's Mundra Port also continues to be the second largest commercial port of India both in total cargo as well as in the container, with 76.2 million metric tonne (MMT) of port cargo being handled. Adani Ports and SEZ completed rail line doubling work of 56 kms for Mundra – Adipur rail track and commissioned it in October 2012.

Further, the company expects to achieve the expansion of capacity from current 5,320 MW to 10,000 MW by 2013, even as it sold 14.7 billion power units in nine months so far. Adani Power Maharashtra signed FSA of 2.3 MMT with SECL for Tiroda. The company currently has 9 MMT of FSA for Mundra and Tiroda Power Projects.