HCC Q4 total income seen down 9% at Rs 1,091 cr

By Sonia Shenoy, Research Analyst at CNBC-TV18

Hindustan Construction Company (HCC) is expected to report a loss of Rs 20 crore in the fourth quarter of FY12 as against profit after tax of Rs 23 crore in a year ago period, according to CNBC-TV18 poll.

Total income is likely to decline 9% to Rs 1,091 crore from Rs 1,202 crore year-on-year.

EBITDA too is seen going down by 23% to Rs 128 crore in the January-March quarter of 2012 versus Rs 166 crore in the corresponding quarter of last fiscal. Operating profit margin is expected to be at 11.76% versus 13.83% during the same period.

For the financial year 2011-12, analysts on average expects HCC to report a loss of Rs 188 crore as against profit after tax of Rs 71 crore in the previous year.

Total income is likely to go down 4% to Rs 3,923 crore from Rs 4,091 crore and EBITDA is seen falling by 12% to Rs 470 crore from Rs 537 crore during the same period.

Company incurred an exceptional costs of Rs 166 crore in the October-December quarter of 2011, which severely impacted bottomline and resulting in a loss of Rs 130 crore for the company.

Exceptional items consisted of provisions for expected future losses and cost revisions due to execution delays

Revenues have been declining due to execution bottlenecks, slowdown in ordering activity, high interest cost environment and payment delays

Key concerns for HCC remain –

Slowing order inflows

High debt and interest costs

Stretched working capital cycle

*** Q3FY12 working capital cycle was around 357 days ((150days or lower is usually considered good for an infrastructure companies))

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