2007-2008 - Cgglobal.com

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The Company has a well-defined disaster recovery plan for accessing critical application from its secondary site at Chennai. On trials, the system can ‘go live’ in less than two hours from a system breakdown situation Information Technology INFRASTRUCTURE AND DISASTER RECOVERY Crompton Greaves has a robust IT infrastructure and network across all its manufacturing and marketing locations. The SAP platform is ably supported by hardware using the latest Multi- Protocol Label Switch, enabling the IT networks to deliver a wide variety of advanced, valueadded services over a single infrastructure with efficient connectivity and ease of maintenance and diagnosis. The Company’s principal data centre houses all the servers that run critical applications, such as SAP, Business Warehouse, Dealer Portal, After- Sales Service Portal, CGHR4U and Six Sigma. The Company has a well-defined disaster recovery plan for accessing critical application from its secondary site at Chennai. On trials, data has been re-accessed in less than 30 minutes, and the system can ‘go live’ in less than two hours from a system breakdown situation. BUSINESS INTELLIGENCE WAREHOUSE Implemented last year, the Company’s Business Intelligence Warehouse (BIW) has been working smoothly. Using COGNOS and the SAP data warehouse, it makes effective analysis of sales trends, debtors’ management, dealer performance and inventory patterns. The reports are auto-distributed to business heads and regional heads at regular intervals, which, in turn, enable them to make informed decisions and mid-course corrections, wherever needed. ONLINE ORDERING PORTAL FOR TRADED PRODUCTS The Company’s SAP based online ordering and integrated dealer portal, allows dealers and customers to place orders online and then track them right up to delivery. It has been enhanced with the introduction of an integrated online sales support request processing system. This allows price authorisations to be made directly at the customer end for most standard products, extends the concept of ‘self service’ and ensures faster response to dealers and customers. HR PORTAL This initiative has been discussed in the Human Resources section earlier in the chapter. E-PAYMENTS Crompton Greaves has implemented an electronic payment processing system across the Company, which ties up with a banking partner. It allows the Company to manage working capital funds more efficiently, since only the required amount of funds are transferred to the bank for effecting payment. There are also administrative benefits in this exercise, since the cheques are printed and issued by the bank. Vendor satisfaction is also an important outcome of this exercise, since the vendor gets confirmation immediately after transfer of funds through the online payment advice sent to his email address. PT INC. PLANT, USA SPECIALIZED IN MANUFACTURE OF SMALL POWER TRANSFORMERS IS AMIDST AN EXPANSION PROGRAMME FOR ENHANCEMENT OF THE RANGE UPTO 60 MVA 24 ANNUAL REPORT 2007–2008 CROMPTON GREAVES LIMITED
Financial Performance We first highlight Crompton Greaves’ standalone results, after which we discuss the financial performance of Pauwels, Ganz and Microsol and, finally, the consolidated financials for the Company as a whole. STANDALONE PERFORMANCE The standalone performance of Crompton Greaves for the year ended 31 March 2008 is detailed in Table 6. Table 7 gives the key ratios (profitability, assets efficiency and leverage ratios) of the standalone entity for 2006-07 and 2007-08. GROSS SALES grew by more than 15% over the previous year to reach Rs.42,226 million. Net sales increased by 15% to Rs.38,758 million. MATERIAL & OPERATING COSTS Despite the pressure of rising input costs, a combination of better supply chain efficiencies, intelligent procurement management and vendor development has meant that material costs have grown by 10.4% (compared to a 39.2% increase in material costs during the previous year). Consequently, materials, manufacturing and operating expenses as a percentage to net sales have dropped from 75.1% in 2006-07 to 72.2% in 2007-08, resulting a net return of 2.9% on net sales. OPERATING EBIDTA Operating earnings before interest, taxes, depreciation and amortisation (operating EBIDTA) grew by 42% over the previous year to Rs.4,838 million. Thanks to a 15% topline growth and significant operating efficiencies, operating EBIDTA to net sales margin increased by 230 basis points: from 10.2% in 2006-07 to 12.5% in 2007-08. NOI Non-operating income for 2007-08 almost doubled to Rs.696 million. Hence, EBIDTA including NOI as a percentage to net sales grew 310 basis points from 11.2% in 2006-07 to 14.3% in 2007-08. OPERATING PROFIT BEFORE TAXES (operating PBT) witnessed 53% growth over last year to reach Rs.4,160 million. PBT including NOI increased by 58% to reach Rs.4,857 million. TAX LIABILITIES grew by 50% over last year to Rs.1,717 million (2006-07: Rs.1,146 million). TABLE 06 STANDALONE PERFORMANCE OF CROMPTON GREAVES YEAR ENDED 31 MARCH, IN RS. MILLION FY 2007 FY 2008 GROSS SALES & SERVICES 36,599.8 42,226.0 LESS: EXCISE DUTY 2,923.7 3,468.4 NET SALES AND SERVICES 33,676.1 38,757.6 MATERIAL, MANUFACTURING & OPERATING EXPENSES 25,284.2 28,000.1 STAFF EXPENSES 1,742.6 2,009.9 SELLING & ADMINISTRATION EXPENSES 3,231.0 3909.7 OPERATING EBIDTA 3,418.3 4,837.9 OTHER NON-OPERATING INCOME (NOI) 348.8 696.3 EBIDTA INCLUDING NOI 3,767.1 5,534.2 INTEREST & COMMITMENT CHARGES 303.5 271.1 DEPRECIATION, AMORTISATION & IMPAIRMENT 393.6 406.6 OPERATING PBT 2,721.2 4,160.2 PBT INCLUDING NOI 3,070.0 4,856.5 LESS: PROVISION FOR TAX CURRENT TAX 840.0 1,520.6 DEFERRED TAX 264.8 146.7 FRINGE BENEFIT TAX 41.5 50.0 PAT 1,923.7 3,139.2 TRANSFER (TO) / FROM DOUBTFUL DEBTS RESERVE 89.6 161.4 B/F FROM PREVIOUS YEAR 1,814.1 3,097.6 TRANSFER TO GENERAL RESERVE (192.4) (313.9) DIVIDEND (INCLUDING CDT) (537.4) (686.2) BALANCE CARRIED FORWARD TO THE BALANCE SHEET 3,097.6 5,398.1 BASIC AND DILUTED EPS (IN RS.: PER RS.2 SHARE) 5.3 8.6 NOTE Figures for 2006-07 have been regrouped wherever necessary in order to make them comparable with those of 2007-08. TABLE 07 STANDALONE PERFORMANCE OF CROMPTON GREAVES — KEY RATIOS YEAR ENDED 31 MARCH FY 2007 FY 2008 PROFITABILITY RATIOS OPERATING EBIDTA / NET SALES 10.2% 12.5% EBIDTA WITH NOI / NET SALES 11.2% 14.3% PBT / NET SALES 9.1% 12.5% RONW 28.5% 33.7% ROCE (AT YEAR-END CAPITAL EMPLOYED) 34.4% 47.9% CASH ROCE 38.4% 51.7% EPS (RS. PER SHARE OF RS.2 EACH) 5.3 8.6 CASH EPS (RS. PER SHARE OF RS.2 EACH) 7.0 10.1 ASSETS EFFICIENCY NET SALES TO GROSS WORKING CAPITAL (TIMES) 2.3 2.3 NET SALES TO NET WORKING CAPITAL (TIMES) 8.1 10.7 LEVERAGE RATIOS TOTAL DEBT TO EQUITY 0.4 0.1 INTEREST COVERAGE 12.4 20.4 MANAGEMENT DISCUSSION AND ANALYSIS 25
Page 1 and 2: CROMPTON GREAVES LIMITED ANNUAL REP
Page 3 and 4: RETURNS PERCENT 23 PERCENT 25.90 RO
Page 5 and 6: $ Return on net worth (RONW) rose b
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Page 11 and 12: CG Power’s Indian operations show
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PRODUCTS & SERVICES 140 ANNUAL REPO
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HT Motors: GANZ HT Slip Ring Motor
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ESTABLISHMENTS REGISTERED OFFICE CG
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WESTERN REGION Regional Head Office
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HOLDING PAUWELS INTERNATIONAL N.V.
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2007-2008 - Cgglobal.com

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