A tete-a-tete with our Chairman
IN FY22, WE RECORDED A REVENUE FROM OPERATIONS OF Rs.2,248.74 CRORE, WHICH WAS AT AN
ALL-TIME HIGH AND A MULTIFOLD INCREASE OF 201% YEAR-ON-YEAR. WE ALSO ACHIEVED A MARKED
INCREASE IN OUR EBITDA FROM Rs.289.41 CRORE IN FY21 TO Rs.1,009.36 CRORE IN FY22,
RENDERING AN EBITDA MARGIN OF 38% AND 44%, RESPECTIVELY.
DEAR SHAREHOLDERS,
It is a pleasure to welcome you to the Annual General Body meeting of SMIORE. I recall
that at the same time last year, we were faced with unprecedented challenges due to the
Covid-19 pandemic. Let us bow our heads in silent prayer to our near and dear ones who
lost their lives during that terrible time.
I am relieved that we have not only recovered from the setbacks of that time, but have
also become more resilient and mindful of ourselves, our surroundings and our people. FY22
was an eventful year for our Company. Happily, we grasped the opportunities that came our
way and delivered a robust performance across all business segments, as our strategies
aligned well with our execution.
SUPERIOR FINANCIAL POSITION
In FY22, we recorded Rs.2,248.74 crore of Revenue from Operations, which is an all-time
high, and a 201% increase over the previous year's performance. We achieved an increase in
our FY21 EBITDA from Rs.289.41 crore; a margin of 38%, to Rs.1,009.36 crore in FY22, a
margin of 44%. Our PAT grew from Rs.153.93 crore in FY21 to Rs.675.11 crore in FY22, which
is an impressive increase of 339% over the previous year. Besides reporting a superior
topline and bottomline performance, SMIORE achieved vastly improved cash conversion,
resulting in a record Rs.873.05 crore of net Cash from Operating Activities.
At the end of FY22 our Company's gross Debt-to-Equity ratio stood at 0.19 compared to
0.37 in the previous year.
An improved gross Debt-to-Equity ratio coupled with surplus cash reserves has
effectively made us a net debt- free Company, further cementing our confidence in our
strategies and the direction we have chosen to traverse.
On the operational front, we recorded robust volumes across all our product segments,
especially in Ferroalloys and Coke. FY22 was the first full financial year of operations
for our Coke segments.
Our realizations in these segments have been in tandem with global trends, which
resulted in record profitability for the Company.
It is thus safe to say that SMIORE has surpassed its operational and financial
expectations in FY22, and is now ready to take on its next leg of challenges.
SMIORE'S ENHANCED PROFIT PROFILE
Let us take a closer look at our enhanced profit profile for FY22, which comes in the
wake of robust financial performance for the last two years. This is the result of our
successful efforts at business diversification.
As may be seen in the below illustration, there was a quantum jump in our PBT, which
moved from an average of Rs.230 crore between FY18 to FY20 to Rs.996 crore in FY22. This
was achieved through two measures, namely, the addition of the Coke and Energy segment,
which has resulted in a new stream of profit, and refurbishing and modernisation of the
Ferroalloys segment, resulting in significant capacity expansion.
While we acknowledge that our profitability has also been buoyed by good prevailing
commodity prices, which may not be repeated every year, we are confident that the Company
will maintain a healthy mix of different profit streams, resulting in a more resilient
business model than what prevailed in previous years. Furthermore, we plan to build on
this momentum with further CAPEX, already in the pipeline.
Surpassed
It is safe to say that SMIORE has indeed surpassed its financial expectations in FY22,
and is now ready to take on its next leg of challenges.
SMIORE'S GOALS AND AMBITIONS
As communicated through our regular disclosures last year, SMIORE has reworked its
long-term operational strategy to better suit its ambitions. With new leadership and
renewed fervour, SMIORE is prepared and ready to take the next big leap. In this regard,
we have modified our earlier plan for a 1 MTPA fully-integrated steel plant. We now aim to
build and operate a 0.4 MTPA hot metal plant, along with a value-added production facility
of 0.3 MTPA of DI Pipes. This facility will be a fully-integrated one, with captive Iron
Ore and in-house Coke production. Not only is the new plan more suited to SMIORE's current
scale of operation and capital allocation policy, but it is also the next step in our
ambition to manufacture value-added products. This is in line with our aim to transform
ourselves from a merchant miner to an integrated commodity player focused on producing
value-added end-products. With this project we will become one of the few plants in India
with such a thorough level of integration.
CONCLUSION
I thank all of you for your support and encouragement. It is your faith in us that
keeps us motivated to create maximum value for all of you. We believe we have delivered on
our expectations and promises in the past, and we are certain that our endeavours will
bear fruitful results as we go forward.
T.R. Raghunandan
Chairman.