GMR Infra net loss widens by 2.2 times

Power projects continues to be starved of fuel

GMR Infrastructure, the publicly held company based in this city, has reported a 2.2 times increase in net loss to Rs 393 crore for the second quarter of this financial year, as compared to the corresponding quarter of 2012-13, when the loss was Rs 179 crore.

The company builds and manages a host of power, airport and highway projects. It says it has suffered this sharp increase in net loss due to idle power generating assets, which lack fuel.  

The company, which also manages the Delhi and Hyderabad international airports, has said net revenue dropped by close to four per cent, to Rs 1,940 crore.  The operating profit, however, was propped up by 12.5 per cent to Rs 576 crore, due to foreign exchange gains and improvement in airport operations. However, interest ouflow of Rs 684 crore, which shot up by 17 per cent, has hit the balance sheet, taking out exceptional gains to deliver a loss of Rs 393 crore.

G M Rao, chairman, GMR Group, put the blame squarely on the lack of gas for its power projects, idling on the Andhra coast, which have capacity of close to 600 Mw. "In our energy portfolio, the lack of gas continues to affect us. This is being offset to some extent, as our coal- based plants are now stabilising. Recently, we commissioned the second unit of 300 Mw at EMCO, the 350 Mw second unit at Kamalanga and the transmission unit at Maru. In addition, we won a 150 Mw power supply bid for Tamil Nadu. We continue to focus on creating liquidity by meticulous management of our receivables and cash flow," he added.

This sharp negative effect from the power project totally blunted the smart performance of its airports division, which contributed half of the revenues, and added weight to the balance sheet with a Rs 57 crore net profit. "Our airport operations at Delhi and Hyderabad are stable and both are experiencing healthy passenger growth, especially in international passengers, which is driving non-aero revenue growth. Our Istanbul airport turned PAT (profit after tax)-positive for the current quarter. On the regulatory side, we have already filed the tariff (rates) application for Hyderabad airport," Rao added.

The company has debt of a little over Rs 38,000 crore, with a gearing (debt to equity ratio) of almost 3.7.

“The macro economic situation is showing signs of improvement. However, sustaining this will need continued focus on reforms and infrastructure development. It is important to de-bottleneck crucial areas like power generation and highways, without which the targeted growth rate will be challenging. The current thought process of enabling infrastructure financing through policy changes is also welcome,” said Rao.

Adding: “In the current quarter, we divested a 74 per cent share in GMR Ulundurpet Expressways for Rs 222 crore. At the same time, we continue to explore opportunities with low capex requirements and quick cash generation."

The scrip lost 5.2 per cent on Wednesday, to close at Rs 20.85 a share on the National Stock Exchange.

	Quarter Ended
Particulars	########	########	Change (%)
Net Revenue	1940	2014	-3.6
Forex loss / (gain)	23	19	21
EBITDA	576	512	12.5
EBITDA Margin	30%	25%
Interest	684	485	41
Other Income	81	81
Exceptional Items	37	-
Depreciation	333	257	29.5
PBT	-322	-149	116
Tax	58	54	7.4
PAT After Minority	-393	-179	119