Air conditioning and commercial refrigeration company Blue Star Ltd on Tuesday reported a 88.85 per cent decline in consolidated net profit at Rs 8.90 crore for the fourth quarter ended March 2020 due to COVID-19 pandemic and the subsequent lockdown.
The company had posted a consolidated net profit of Rs 79.84 crore in January-March quarter a year ago, Blue Star said in a regulatory filing.
Revenue from operations fell 18.57 per cent to Rs 1,299.36 crore during the period under review as against Rs 1,595.84 crore in the corresponding period of last fiscal, the company said.
"The fourth quarter also started on track, however, the rapid spread of the COVID-19 pandemic across the globe resulted in significant demand and supply chain disruptions across India in the month of March," Blue Star said in a post-earnings statement.
Further, the nationwide lockdown imposed by the government towards the end of March resulted in a complete shutdown of all operating activities.
"Order fulfilment suffered and consequently there was a significant impact on the company's billing and profitability in the fourth quarter of the financial year." it said.
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"The operating cash flow also slowed down significantly requiring swift actions to rebuild adequate liquidity on the company's balance sheet, so as to meet external obligations and commitments," it added.
The company's total expenses declined 15.01 per cent to Rs 1,292.63 crore during the quarter as against Rs 1,521.07 crore in the year-ago period.
Its revenue from electro-mechanical projects and commercial air conditioning systems segment fell 21.59 per cent to Rs 660.39 crore as against Rs 842.31 crore.
Similarly, revenue from unitary products was down 15.25 per cent to Rs 596.28 crore as against Rs 703.63 crore in Q4 FY2018-19, while that from professional electronics and industrial systems fell 14.44 per cent to Rs 42.69 crore from Rs 49.90 crore a year ago.
For fiscal year 2019-20, Blue Star's net profit declined 24.98 per cent to Rs 143.25 crore as against Rs 190.96 crore in the previous year.
However, revenue from operations rose 2.39 per cent to Rs 5,360.19 crore as against Rs 5,234.84 crore in 2018-19.
The company expects a gradual recovery in demand and hopes to regain the lost ground from second quarter onwards.
"While the demand had taken a hit due to the national lockdown, we are hopeful that there will be gradual recovery from May 2020 onwards," Blue Star Vice Chairman & Managing Director Vir Advani said.
According to the company, tier-III and below markets, which account for 60 per cent of the revenue for unitary products, are less impacted by the slowdown and may "partially make up for the lost summer season sales".
"The demand for our commercial refrigeration products, specifically from the healthcare, pharmaceuticals, processed food and food delivery sectors is growing. While two of our factories have opened with partial strength, we are planning to open the other three factories in June," Advani said.
"While Q1FY21 will be a challenging quarter, given the strong fundamentals and diverse portfolio, the company is well positioned to regain lost ground from Q2 onwards," he added.
Shares of Blue Star Ltd on Tuesday settled 0.65 per cent higher at Rs 474 on the BSE.
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