New Delhi : Orient Bell Limited (BSE: 530365; NSE: ORIENTBELL), hereinafter referred to as OBL, a leading manufacturer of ceramic and vitrified tiles with a capacity of ~31 million square metres per annum, has reported results for the quarter ended December 31, 2021.
Summary:
Q3 was a challenging quarter with a massive increase in manufacturing costs and a demand slow down post Diwali. The company stayed focused on its strategy and strengthened sales & distribution infrastructure. With a focus on fundamental benefits & improved execution we have been able to pass on 100% of the cost escalation to the customer.
As a result, the company continued to make rapid progress simultaneously on each of the 3 critical financial KPI’s:
- Topline growth
- Margin improvement
- Focus on cash flows.
During Q3 we successfully completed an expansion project at Sikandrabad, adding 0.7 MSM p.a. capacity. Two other projects (1 each at our existing facilities at Sikandrabad, Uttar Pradesh and Dora, Gujarat) are on track and expected to be completed in Q1FY23 – the combined incremental volume potential being ~1.9 MSM p.a..
Another “Scale Up” capex project aimed towards improving our footprint in South is underway at our existing facility at Hoskote, Karnataka (incremental capacity of 1.8 MSM p.a) and is expected to be completed by Q3FY23.
These projects are largely being financed via internal accruals as the company continues to focus on working capital to generate cash flows for future expansion.
The uptick in the real estate sector is a positive sign for the industry and OBL is confident to stay on track to steadily improve all operational metrics.
Q3FY22 Key Financial Highlights:
- Revenue increase led by New Products, Improved Product Mix, ASP increase, Channel Expansion and OBTB additions: Q3FY22 +25% y-o-y; 9MFY22 +37% y-o-y.
- Despite rising Energy and other Costs, consistent improvement in consumption KPI’s and operating leverage led to improved profitability margins vs. last year.
- On a consolidated basis (including OBL’s share of profit from Associates), PAT for Q3FY22 at Rs. 12.1 Crores vs Rs. 7.5 Crore in Q3FY21.
- Strong focus on working capital management continues – Cash Conversion Cycle continues to be under 20 days.
- Net debt continues to stay below ZERO at Rs (-) 21.4 crore as on 31-Dec-2021.
Consolidated Financial Highlights:
| Consolidated | Q3FY21 | Q3FY22 | YoY | 9MFY21 | 9MFY22 | YoY |
| Operating income | 147.9 | 184.0 | 24.4% | 321.0 | 438.4 | 36.6% |
| EBITDA | 15.7 | 19.9 | 26.8% | 17.5 | 32.1 | 83.4% |
| EBITDA % | 10.6% | 10.8% | 0.2% | 5.5% | 7.3% | 1.9% |
| Reported PAT | 7.5 | 12.1 | 60.7% | -0.6 | 15.7 | 2818.2% |
| PAT % | 5.1% | 6.6% | 1.5% | -0.2% | 3.6% | 3.8% |
Operational highlights Q3FY22:
- 27 Orientbell Tile Boutiques (OBTBs) net added during Q3FY22; the total number of active OBTB’s as on 31-Dec-21 increased to 276
- Ashwamedha Project 3.0 – 112 CPs added/revived during Q3FY22
- Revenue from vitrified tiles improved to 45% vs. 41% in Q3FY21
- Marketing Investments increased further – +50% vs. Q3FY21 and increased sequentially by ~30%
- More than ~110 SKUs launched Q3FY22 across existing & New Product categories