Cyient spurted 4.33% to Rs 296.45 after the company's consolidated net profit surged 80% to Rs 81.40 crore on 7.62% decline in revenue from operations to Rs 991.70 crore in Q1 June 2020 over Q4 March 2020.
Consolidated profit before tax (PBT) jumped 25.84% to Rs 108.60 crore in Q1 June 2020 as against Rs 86.30 crore in Q4 March 2020. Current tax expense for the quarter soared 42.04% at Rs 34.80 crore as against Rs 24.50 crore in Q4 March 2019. The Q1 earnings were announced post market hours yesterday, 16 July 2020.
Cyient's services revenue was at $112.2 million, registering a de-growth of 15.2% Q-o-Q (quarter-on-quarter) and de-growth of 18.6% Y-o-Y (year-on-year). DLM revenue stood at $18.4 million, recording a growth of 8.5% Q-o-Q and de-growth of 1.4% Y-o-Y. EBIT margin for services was at 6.7%, down 283 bps Q-o-Q. EBIT margin for DLM at -4.6%, down 410 bps Q-o-Q.
The company's cash and cash equivalents stood at Rs 1,109.80 crore. In Q1 FY21, the cash flow conversion stood at 138.1% for group and 144.9% for services. DLM has generated cash of Rs 8.5 crore in Q1 FY21 while export incentives worth Rs 51.90 crore boosted cash conversion.
Commenting on the Q1 performance, Krishna Bodanapu, the managing director (MD) and chief executive officer (CEO) of Cyient, has said that: "Q1 FY21 results were better than our expectations, where we recorded a revenue of $130.6 million which was lower by 11.6% Q-o-Q and 15.1% Y-o-Y in constant currency. Services business was lower by 14.3 % Q-o-Q in constant currency. The DLM business grew by 8.5% Q-o-Q. We expect traction from top clients to return post Q2. The EBIT margin is lower by 328 bps Q-o-Q mainly due to lower business volume which was somewhat offset by lower SG&A spend. We generated free cash flow of INR 2,163 Mn which was higher by 101% Q-o-Q."
"Our outlook for Q2 is positive and we expect growth to return in all industries except Aerospace, which will de-grow further in Q2. For the year, we expect a de-growth in revenue in double digits. We will also reiterate that H2 margin will be back to the steady state margin of H1 of last year. This will continue to be underpinned by strong free cash flow generation and prudent capex spend," he added.
Cyient is a global engineering and technology solutions company.
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