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Piramal Enterprises Limited Announces Consolidated Results for Q4 & FY2020 ended March 31, 2020

Piramal-Enterprises

– Resilient operating performance and significant strengthening of the balance sheet-

Mumbai, India, May 11, 2020: Piramal Enterprises Limited (‘PEL’, NSE: PEL, BSE: 500302, 912460) today announced its consolidated results for the Fourth Quarter (Q4) and Full year FY2020 ended 31st March 2020.

Financial Highlights

Key Balance sheet movements:

  • Capital inflows of INR 14,500 Cr. from key milestone transactions
  • Total equity increased 12% to INR 30,572 Cr. vs. INR 27,224 Cr. last year
  • Net debt reduced by INR 17,838 Cr. to INR 37,283 Cr. vs. INR 55,122 Cr. last year

Key P&L movements:

FY2020:

  • Revenue grew by 10% YoY to INR 13,068 Cr.
  • Normalized Net Profit grew 22% YoY to 2,615 Cr.
  • Reported Net Profit of INR 21 Cr.

Q4 FY2020:

  • Revenue declined 2% YoY to INR 3,341 Cr.
  • Normalized Net Profit grew by 40% to INR 807 Cr.
  • Reported Net Loss of INR 1,703 Cr. for Q4 FY2020 vs. Net Profit of INR 455 Cr. for Q4 FY2019

Dividend:

Keeping in mind the global environment of heightened uncertainty caused by the COVID-19 pandemic on one hand and on the other, the recent sale of our DRG business as well as the interest of the minority shareholders, the Board has recommended a Dividend of INR 14 per share for the approval of the Shareholders in the AGM. The total dividend payout on this account would be INR 316 Crores.

Ajay Piramal, Chairman, Piramal Enterprises Ltd. said, “The last few quarters have been challenging for the Indian economy. The situation has further worsened due to the COVID-19 pandemic, with a subsequent economic recovery likely to be long-drawn. To navigate through such an environment, we have significantly strengthened and deleveraged our balance sheet through multiple initiatives to raise capital.

Our Pharma business continues to be operational despite COVID 19 lockdowns and has delivered a healthy revenue growth of 13% YoY to INR 5,419 Crore and an EBITDA margin of 26% for FY20.

We have consciously shrunk our wholesale loan book by 12% and more importantly, reduced our large single borrower exposure by INR 4,200 Crores over the past year. Further, given the uncertain macro environment, we have created INR 1,903 Crores of additional provision to mitigate potential contingencies in our Financial Services business.

We continue to make best efforts to support our employees, customers and society, towards overcoming this unprecedented global health crisis.”

Net Profit Reconciliation: Details of one-off adjustments to determine ‘Normalized Net Profit’:

One-off Adjustments (INR Crores, unless otherwise stated) Q4 FY2020 FY2020
Reported Net Profit (1,703) 21
(A) Add: DTA write-off and MAT Credit Reversal

One-time accounting write-off of INR 1,758 Cr. of Deferred Tax Asset (DTA) and reversal of Minimum Alternate Tax (MAT) Credit, as the Company opted for a lower tax rate under the new corporate tax regime

 +1,758 +1,758
(B) Add: Incremental conservative provisions

One-off incremental provisions of INR 1,903 Cr. (INR 1,411 Cr., net of taxes) in Financial Services. Adopted a conservative and prudent approach, given macroeconomic uncertainties

 +1,411 +1,411
(C) Less: (Profit)/loss from discontinued operations

Net gain from the sale of DRG (incl. profit/loss from discontinued operations in the year)

 -658 -574
Normalized Net Profit 807 2,615
YoY Change in Normalized Net Profit +40% +22%

 

Key Business Highlights

Financial Services:

  • Loan book at INR 50,963 Cr., with top-10 exposures reduced by ~INR 4,200 Cr. during the year
  • Raised ~INR 13,500 Cr in long-term borrowings over last one year
  • ~INR 8,900 Crores were available in the form of cash and undrawn bank lines as of Mar 31st, 2020
  • Housing Finance loan book of INR 5,534 Cr.; aim to create a multi-product Retail Lending franchise
  • Overall provisioning at ~2.5x times of GNPAs and 5.8% of overall loan book
  • Capital Adequacy ratio of the Financial Services business at 31% (vs. 22% as of Mar-2019)

Pharma:

  • Pharma revenues up 13% to INR 5,419 Cr. for the year
  • With the EBITDA margins at 26%, FY20 EBITDA for the Pharma business crossed INR 1,400 Cr.
  • Delivered a healthy growth for the year in each of the three Pharma business segments – CDMO, Complex Hospital Generics and India Consumer Healthcare
  • India Consumer Healthcare revenues grew up 25% to INR 418 Cr.

Business-wise Revenue Performance

 (INR Crores or as stated)

Net Sales break-up Quarter IV ended % Sales

for Q4 FY20

Full year ended % Sales for
FY2020
31-Mar-20 31-Mar-19 % Change 31-Mar-20 31-Mar-19 % Change
Financial Services 1,718 1,933 -11% 51% 7,649 7,063 8% 59%
Pharma3 1,623 1,476 10% 49% 5,419 4,786 13% 41%
Pharma CDMO 1,048 939 12% 31% 3,154 2,783 13% 24%
Complex Hospital Generics 500 450 11% 15% 1,853 1,669 11% 14%
India Consumer Products 82 89 -8% 2% 418 334 25% 3%
Others – – – – – 34 – –
Total 3,341 3,409 -2% 100% 13,068 11,883 10% 100%
  1. Foreign Currency denominated revenue in Q4 FY20 was INR 1,417 Cr. (42% of total revenue) and in FY20 was INR 4,497 Cr. (34% of the total revenue)
  2. Previous year figures are restated for accounting effect of Piramal Phytocare merger and  discontinued operations from HIA
  3. Pharma revenue includes certain Foreign exchange income
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