Adani Ports Q4 Results: Profit Plunges 74%, Margins Narrow As Covid-19 Stalls Economy

Adani Ports and SEZ Ltd. reported a sharp decline in quarterly profits amid the Covid-19 pandemic which disrupted global trade and stalled economic activities.

Net profit fell 74 percent over the same quarter last year to Rs 334 crore in the January-March period, according to its exchange filing. Analysts' estimates compiled by Bloomberg had pegged profit at Rs 887 crore.

• Revenue fell 5.23 percent year-on-year to Rs 2,921 crore—lower than the estimated Rs 3,265 crore.
• Operating profit fell 15 percent to Rs 1,644 crore.
• Margin narrowed 640 basis points to 56.3 percent.

Despite a tough trade environment due to Covid-19, Adani Ports saw cargo offtake volumes increase 7 percent to 58 million metric tonne. That was mainly due to the addition of two new ports at Katupalli and Ennore. However, the gains were offset by lower revenue from special economic zones, higher operating expenses and foreign exchange losses.

Adani Ports reported forex losses of Rs 1,004 crore during the quarter—almost ten times that in the comparable period last year. Operating expenses rose 11 percent to Rs 922 crore while other expenses increased 32 percent to Rs 204 crore.

The company said it will reduce operating costs and curtail its capital expenditure to Rs 2,000 crore in 2020-21. It said it'll focus on conserving cash and generating higher free cash flow. Besides, the company said a ‘V-shaped recovery' is possible in the second half of the fiscal after the lockdowns triggered by Covid-19 are lifted completely.

Balance Sheet Highlights

• Gross debt at Rs 29,463 crore verssus Rs 27,188 crore last year
• Net debt at Rs 22,137 crore versus Rs 20,707 crore last year
• Net debt to Ebitda ratio steady at 2.9

Shares of the port operator closed 1.26 percent lower, ahead of the results, while the benchmark BSE Sensex ended trade 0.83 percent down.