L&T Technology Services (LTTS)'s consolidated net profit slipped 19.4% to Rs 166.30 crore on 6.3% decrease in net sales to Rs 1,313.80 crore in Q2 September 2020 over Q2 September 2019.
Consolidated profit before tax (PBT) declined 18.4% to Rs 225.80 crore in Q2 September 2020 as against Rs 276.60 crore in Q2 September 2019. Total tax expense for the quarter dropped 15.55% at Rs 59.50 crore as against Rs 70.40 crore in Q2 September 2019.
Sequentially, LTTS' consolidated net profit jumped 41% and net sales rose 1.5% in Q2 September 2020 over Q1 June 2020. The Q2 result was declared after trading hours yesterday, 19 October 2020.
Commenting on the Q2 performance, Dr Keshab Panda, the managing director (MD) and chief executive officer (CEO) of LTTS, stated: "We had a strong quarter with broad based revenue growth and an improvement in operating margin performance, in line with what we had guided. Steady order bookings and a healthy pipeline across all segments gives us confidence that the growth momentum will continue. Customers are accelerating the deployment of digital engineering projects to enable business continuity and drive scale. LTTS with its highly differentiated skillsets in Plant Engineering is thus rightly positioned to provide solutions around virtualization, 3D Modelling and digital twin, that allows it to partner with customers on transformational programs."
"Our efforts to build a Platforms and Solutions practice has started to see better traction in the marketplace with customers demanding solutions that provide enhanced safety and remote productivity in the context of the pandemic. LTTS' solutions such as i-BEMSTM. Shield - a smart campus framework, and AVERTLETM - a predictive maintenance solution for touchless plant operations, have seen multiple wins in Q2 and the pipeline looks exciting. We continue to invest in design labs; in Q2, we opened a state-of-the-art EV lab to work on technologies that will improve the performance and endurance of electric vehicles. Our EV practice is seeing good traction across top Auto OEMs and suppliers."
During the quarter, LTTS won 8 multi-million dollar deals across all industry segments including 3 deals with TCV of $15 million plus and another 3 deals with TCV of $10 million plus. Revenues from digital and leading-edge technologies stood at 49% during the quarter.
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At the end of the second quarter, the patents portfolio of L&T Technology Services stood at 550, out of which 404 are co-authored with its customers and the rest are filed by LTTS. The company's employee strength stood at 15,902 by the end of Q2 FY21.
Meanwhile, the board has declared an interim dividend of Rs 7.50 per equity share. The record date is on 27 October 2020.
The board has also extended the term of Dr Keshab Panda as the CEO & MD of the company upto 31 March 2021 while extending the term of Amit Chadha as the deputy CEO & whole-time director of the company up to 31 March 2021. Further, Chadha has been appointed as the CEO & MD of LTTS for a term of 3 years with effect from 1 April 2021 to 31 March 2024. Dr Keshab Panda will take the role of a non-executive director of the company with effect from 1 April 2021.
Shares of LTTS rose 1.15% to Rs 1,770.60 on BSE. LTTS is a listed subsidiary of Larsen & Toubro (L&T) focused on engineering and research & development (ER&D) services. The company offers consultancy, design, development and testing services across the product and process development life cycle.
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