Hyderabad headquartered technology and manufacturing solutions provider Cyient reported a 74.4% decline in net profit to Rs 45.2 crore for the quarter ended March 31, as Covid-19 adversely impacted its revenue across segments.
The company attributed the massive slump in its bottomline to the non-receipt of Rs 33.3 crore it expected from the acquisition of design companies Certon and AnSem. The decline was further accentuated by a Rs 22 crore charge on delays in order execution and asset value impairment.
Additionally, revenues of its transportation, energy, and aerospace and defence verticals, which contribute to 60% of the company’s topline, fell in the range of 5-20% during the quarter.
The company’s consolidated revenue for Q4 stood at Rs 1,074 crore, down 9.7% from Rs 1,164 crore a year ago.
For the full year, its topline fell 4.1% to Rs 4,432 crore in the financial year ended March 31, compared to Rs 4,618 crore a year ago.
In the previous quarter too, the company’s topline declined 6.9% to Rs 1,106 crore from Rs 1,187.6 crore a year before that.
“We are focused on accelerating business growth. With a strengthened leadership team, we will focus on winning new business, especially in digital focused, IP-driven solutions and services,” managing director and CEO Krishna Bodanapu said in a statement.
“We are preparing to secure (our) future in these challenging times with an aggressive cost control and optimisation plan with primary focus on liquidity and cash. This includes rigorous initiatives on collections, working capital cycles, receivables, payables and discretionary cost control,” CFO Ajay Agarwal said.
“We expect our margins to strengthen in FY21 where the full benefits of improved operational efficiency will be visible. The Covid-19 pandemic has slowed down the positive momentum that we had seen building in the overall performance,” Agarwal added.
Separately, the company has approved increasing the investment limit for foreign portfolio investors (FPIs) to 74% from the current 49%. As of March 31, around 115 FPIs, including T Rowe, Fidelity Investments and RBC Emerging Markets Fund, owned 42.16% stake in the company.
Cyient designs and builds projects on behalf of its clients in several sectors using digital technologies and analytics. It has 14,000 employees on its payroll globally, 92% of whom are currently working from home due to the Covid-19 lockdown.
During Q4, Cyient received orders from Hitachi Rail for project engineering services and signal technology. Another entity also enlisted its services to manufacture Covid-19 diagnosis units and X-ray systems.
In March, the company appointed Karthikeyan Natarajan as its president and chief operating officer.
Last month, it provided the Telangana police with drone-based surveillance services during the lockdown in Hyderabad.