As we continue scaling new heights, we would like to thank you for giving us the opportunity to deliver exceptional value, as your strategic partner of choice in the journey of transformation. Along with a great second quarter, we have made recent strategic capability and capacity investments to be able to support you better. We wanted to share these updates with you.
The Company’s Q2 FY’19 performance showed sustained growth, backed by a strong open order book, which stands at an all-time high of around USD 1.3Bn. This includes the USD 480Mn crore multi-year system integration contract to design, build and manage the Indian Navy’s digital network.
This sustained growth is a result of Sterlite Tech continually scaling its unique silicon-to-software capabilities, and focusing on designing, building and managing hyper-scale data networks for global communication service providers, internet content companies, citizen broadband networks and the defence.
“We are the only company in the world with expertise in photonics and glass science, which is forward integrated into network roll outs and programmable network design. This gives us a unique advantage to offer solutions for hyper-scale networks for applications such as 5G, FTTx, data centres and defence. Over the last quarters, we have continued to invest and build into this strength,” said Dr Anand Agarwal, Group CEO, Sterlite Tech.
CAPABILITY AND CAPACITY SCALE OUT
Key highlights of the Company’s recent scaling of its silicon-to-software capabilities are:
Solutions’ build out: Sterlite Tech is taking its solutions offerings for 5G, FTTx, data centre and defence applications to market. These are end-to-end suites with optical products and kits and network orchestration in virtualised environments. The Company’s most recent win with the Indian Navy is based on its defence solutions offerings.
Fibre and cable expansion: The Company has been organically and inorganically strengthening its core optical products capability. With these expansions, Sterlite Tech will be among the top integrated fibre and cabling technology providers globally.
European acquisition: The Company acquired 100% stake in Metallurgica Bresciana, a specialised optical-cable manufacturer, in Italy, to expand its European presence.
Doubling of cable capacity to 33 million fkm: The Company committed USD 44mn capital expenditure in greenfield and brownfield expansion to double its cable capacity.
Fibre capacity at 50 million fkm on track: The Company’s ongoing capex programme of expanding its fibre capacity to 50 million fkm is on track, and will be operational by June 2019.
FINANCIAL PERFORMANCE – Q2 FY’19
Sterlite Tech’s consistent financial performance over the past several quarters is a result of these solutions and capability built, in alignment with its unified data networks solutions strategy. The Company’s top line growth and healthy margin profile remain strong, with an annualised Net Profit CAGR growth of 47% in the last three financial years.
Below are the key financial highlights from Q2 FY’19:
Revenues:USD 148mn , up 39% YoY
EBITDA: USD 38mn , up 56% YoY
PAT: USD 18mn , up 84% YoY
The future outlook for Sterlite Tech remains very positive with the current open order book at around USD 1.3Bn, based on a good mix of international and domestic long-term contracts.