schneider electric infrastructure limited · schneider electric infrastructure limited – investor...

Schneider Electric Infrastructure Limited – Investor Presentation

Schneider Electric Infrastructure

Limited

Q3 FY 2019-20

7th Feb 2020

1

Schneider Electric Infrastructure Limited – Investor Presentation 2

Disclaimer

All forward-looking statements are Schneider Electric Infrastructure Limited (India) management’s present

expectations of future events and are subject to a number of factors and uncertainties that could cause actual

results to differ materially from those described in the forward-looking statements.

.

This presentation includes information pertaining to the our markets and our competitive positions therein. Such

information is based on market data and our actual sales in those markets for the relevant periods. We obtained

this market information from various third party sources (industry publications, surveys and forecasts) and our own

internal estimates. We have not independently verified these third party sources and cannot guarantee their

accuracy or completeness and our internal surveys and estimates have not been verified by independent experts or

other independent sources.


Confidential Property of Schneider Electric |

Real GDP Growth Rate 1

Steady recovery expected in GDP growth rate from 2020; Faster than China

CAPEX investment trend 2

Segments - Transport, Healthcare, WWW, Comm. Real Estate expected to drive recovery

Composite Index 3

Stable growth of ~ 5.3% - 6.4% projected for the period 2020 -2021

4.5%

2018 2020

(P)

5.0%

2019

(P)

7%-7.5%

2021

(P)

4.8%

6.8%

+ + +

2019

(P)

6.8%

3.6%

2018

5.4%

6.4%

2020

(P)

2021

(P)H1’18 H2’18 H1’19 H2’19

India Emerging Eco

6% - 6.5%

1 Source: IMF & MOSPI for actuals & forecasts2 Source: CMIE for actuals & forecasts3 CI: Composite Index source is Oxford Economics. Figures updated as per Jan’20 release

Actuals Forecast

After a tough 2019, 2020 expected to be better; But we need

to proceed with caution

8.9

5.7

4.4

6.1

Announced Investment (INR Tn)

3


CPI - Inflation

India’s CAD widened to 2.0% ascompared to 0.7% in last quarter.

CPI inflation has shown signs ofincrease; led by surge in foodprices.

CAD (%GDP) Current account deficitGFCF – Gross Fixed capital formationGVA- Gross value addedGDP – Gross Domestic Product

GVA growth also slowed downto 4.3% as compared to 6.9% inQ3 2018.

GFCF growth rate slowed down to1.0% as compared to 11.8% in Q32018, indicating weak investmentscenario.

5.85.0

4.7

Q1’19 Q2’19

4.5

Q3’19 Q4’19

5.8

Q1’20

3.6 4.0

1.00.7

4.6

Q1’19 Q3’19Q2’19 Q4’19 Q1’20

Ease of Doing Business

Competitive rank

Latest Previous TrendGlobal Indices

Broad Economic Indicators

Trends from SEI perspective

2.5

0.7

2.0

0.90.4

Q4’18 Q2’19Q1’19 Q4’19Q3’19

Core Sector Growth

Core Sector Cumulative

Equity Market

Interest Rates

4.00%* 5.15%*CRR Repo Rate

Capital Goods

Sensex

Forecasted Data(CMIE)

GDP growth slowed down to 4.5%in Q3 2019, primarily led by weakinvestment and contraction inexport growth.

Released figures *As on 15 Jan 2020

63(2019-20)

77(2018-19)

68(2019-20)

1.22.6

-0.2

-5.1 -5.8

-1.6

Nov’19Jul’19Jun’19 Aug’19 Sep’19 Oct’19

CY considered Q4’19 : Oct – Dec 2019; Growth % figures are Y-o-Y

Industry growth Indicators

8.6 5.3-0.9 -2.6 -12.2 -5.0Electricity

(% Growth)

Se

cto

r B

as

ed

Cla

ss

ific

ati

on

1.34.9

-1.4-4.4 -4.0

1.8

Manufacturing (% Growth)

IIP (% Growth)

IIP revived in Nov 2019, as it grew by 1.8% YOY breaching thenegative territory.

0.34.8

-1.7 -4.0 -2.32.7

Mining (% Growth)

PMI (Manufacturing)

-1.90.4 -0.6 -1.5 -4.7 -5.2

Aug’19Jun’19 Jul’19 Nov’19Sep’19 Oct’19

1.5 4.90.0

-8.6 -8.0

1.7

3606841254

18821 16944

11/18 03/19 09/1901/19 05/19 07/19 11/19 01/20

Exchange Market

58(2018-19)

4.95.7

Q1’19 Q4’19Q2’19

4.3

Q3’19

4.35.2

Q1’20

80.4579.12

70.72 71.17

01/2011/18 01/19 03/19 05/19 07/19 09/19 11/19

EUR/ INR

USD/ INR

3.1 3.55.8

4.8 4.0

Q2’19 Q1’20Q4’19Q3’19 Q2’20

Slowdown of -1.6% in core Sector growth shows signsof recovery; improving from -5.8% in Oct 2019.

4

Confidential Property of Schneider Electric |

OGPHPCL Mumbai Refinery About the Project

• Supply, Installation, Testing and Commissioning of Integrated Electrical Monitoring and Control Systems along with Asset Management System for 24 Substations of HPCL, Mumbai Refinery.

Customer Objective

• Improve power system reliability and automate asset management of their entire power distribution system

Our Solution: EcoStruxure Grid + Plant • RTU Cum Data Concentrator Units

• Integrating 24 Substation existing IEDs

• PACIS SUI & SET– as EMCS

• Maintenance Resource Center – as Asset Management System

• Intella-track for Asset Management Mobility

• Asset Connect + Asset Advisor for prediction as Pilot

Customer benefits

• Reliability Centric Asset Management (Prediction, Condition Monitoring, Works flow)

• Avoid blackout situation• Reduce Commercial production losses.• Optimize energy & network usage• Improve network operation efficiency & network reliability• Full Integration of existing assets (maximize ROI) • Increase customer service

Schneider Scope

End User – HPCL, MumbaiCustomer - HPCL, Mumbai

Project – EMCS and Asset Management

Apps, Analytics

& Services

Edge

Control

Connected Products

Saitel DP

RTUExisting 24 Substations &

IEDs

EMCS – Central

Electrical Monitoring

and Control System

11

PACiS

Asset Advisor Intella Trac

Maintenance Resource Centre

5

Scope of Work – Oil & Gas Ecostruxure

S/s 1

S/s 24

Co

nn

ec

ted

p

rod

uc

tsE

dg

e

Co

ntr

ol

Ap

ps

&

An

aly

tic

s

Ecostruxure Substation

Control

RTUs

Ecostruxure

Asset Management

Aviva + PA

EM - Digital Energy



In the past 3 months

We observed a general economic slow down , which has slightly affected our order intake

Services and Energy Automation Orders have confirmed their rebound in Q3 , while MV orders werestill dynamic .

After the flood in Baroda that affected our Q2 Sales level , Q3 Sales level was very high .

We observe an overall tension on our customers cash situation , burdening our own finance costs ,even though we continue collecting more cash than our Sales ; but also delaying our Sales ( projectsfrozen , cancelled , delayed , …)

We have done further progress on our licenses and core component partner programs , with 1 newoffer launched in December (PIX MV license offer ) , 2 licenses cases validated in Q3 and ready forcontract signature (both on FBX RMUs ) , and 2 licensed prototypes validated ( for packagedsubstations PSS ) .

7

Financial Update

8Schneider Electric Infrastructure Limited – Investor Presentation

Business Order intake: Q3 FY 20 -2.6% vs last year & 9 Months (Apr to Dec) -0.5% vs last year

Drop in SL2 & SISGT opportunities in 2019 partially mitigated thru Transactional Business (MCP & RMU)

Major Orders booked in Q3 FY 20: Delton Control , HPCL, Adani Trafo , GVS, L&T, SPDCTL, Polycab

9

OrdersQuarterly

MINR

3516 3426

Q3 FY 19 Q3 FY 20

-2.6%

YTD Dec

8647 8602

YTD Dec 18 YTD Dec 19

-0.5%


10

Sales MINR

Sales is up by 9.9% vs last year same quarter & +4.8% vs last year .

Major Sales for the quarter: Tata Project, L&T, SNS Tech, Amara Raja, Vindhya tel, VA Tech etc …

Quarterly

43734807

Q3 FY 19 Q3 FY 20

+9.9%

YTD Dec

10998 11522

YTD Dec 18 YTD Dec 19

+4.8%


11

Financial Results- Q3 FY 2019-20 vs Q3 FY 2018-19 MINR

Sales is up by 9.9% majorly with better volume in Equipment & Services

Employee cost is flat: Annual inflation is mitigated thru restructuring

Other Expense are higher due to higher recovery of old debt and Forex in Last year

MINR % MINR %

Sales 4,807 4,373 9.9%

Other income 72 77

Total Sales 4,879 4,451

Material costs 3,355 69.8% 3,215 73.5%

Gross Margin 1,524 31.7% 1,235 28.2% 3.5%

Employee costs 540 11.2% 544 12.4%

Other expenses 502 10.5% 384 8.8%

EBITDA 481 10.0% 307 7.0% 3.0%

Depreciation 57 1.2% 62 1.4%

EBITA 423 8.8% 245 5.6%

Interest 123 2.6% 114 2.6%

Profit before Exceptional items 300 6.2% 131 3.0% 3.3%

Exceptional 0 194 4.4%

Profit after tax 300 6.2% -63 -1.4% 7.7%

SEIL results analysisQ3 (Oct-Dec 2019) Q3 (Oct-Dec 2018) YoY (%)

Change


12

Financial Results- YTD Dec 2019 vs YTD Dec 2018 MINR

Sales is up by 4.8% majorly with better volume in Equipment

Employee cost: Savings thru restructuring is offset by annual hike, WESOP, PF settlement and higher variable pay-out

Other Expense are higher due to higher recovery of old debt

MINR % MINR %

Sales 11,522 10,998 4.8%

Other income 127 301

Total Sales 11,650 11,299

Material costs 8,220 71.3% 8,034 73.1%

Gross Margin 3,429 29.8% 3,265 29.7% 0.1%

Employee costs 1,616 14.0% 1,507 13.7%

Other expenses 1,313 11.4% 1,208 11.0%

EBITDA 501 4.3% 550 5.0% -0.7%

Depreciation 165 1.4% 199 1.8%

EBITA 336 2.9% 351 3.2% -0.3%

Interest 374 3.2% 330 3.0%

Profit before Exceptional items -38 -0.3% 22 0.2% -0.5%

Exceptional 0 280

Profit after tax -38 -0.3% -258 -2.3% 2.0%

SEIL results analysisYTD (Apr-Dec 2019) YTD (Apr-Dec 2018) YoY (%)

Change


13

Balance Sheet as at Dec 19 Sep 19 FY2019

Equity and liabilities

Shareholders’ fundsShare capital 478 478 478

Reserves and surplus -182 (630) (244) Annual results

296 -152 234

Non-current liabilities

Long-term provisions 270 284 216

Deferred revenue 9 11 28

Long-term borrowings 3,658 1,232 1,160

3,936 1,528 1,404

Current liabilitiesShort-term borrowings 1,241 4,493 3,362

Trade payables 4,851 4,327 4,720

Others 223 214 178

Other current liabilities 727 659 742

Short-term provisions 1,180 1,092 1,169

8,223 10,785 10,171

12,454 12,161 11,809

Assets

Non-current assets

Tangible assets 3,091 3,046 3,031

- Intangible assets 38 41 54

Capital work-in-progress 35 67 57

Deferred tax assets (net) 254 248 223

Other financial assets 98 107 37

Other non-current assets 712 720 686

4,227 4,229 4,087

Current assetsInventories 1,777 2,422 2,421

Trade receivables 5,606 4,328 4,137 Liquidity issues in market- Lower collection & High sales

Cash and Bank Balances 221 174 184

Others 56 129 13

Other current assets 568 878 966 Unbilled Contract Revenue.

8,227 7,932 7,722

12,454 12,161 11,809

Positive Networth with Better

profitability in the quarter

Current assets are higher

than Current Liabilities

Balance Sheet MINR


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