Wind turbine maker Suzlon Energy continued its disappointing run in the second quarter too and reported a net loss of R807.74 crore compared to a profit of R48 crore in Q2FY12. Revenues in Q2 were up 12% to R5,758 crore. This is the fourth successive quarter of net losses for the wind turbine maker. This was in line with Street expectations. However, the quantum of loss has been more than what was expected.
Tulsi Tanti, chairman, Suzlon Group, acknowledged that the first half of FY13 had been disappointing and they were affected by macro-economic headwinds and policy uncertainties in some key markets as well as by their internal challenges around liability management, and sub-optimal capital allocation to business operations.
The company's business fundamentals remained strong and a turnaround of the business was top priority and the debt restructuring would give them more liquidity for their core business, Tanti said.
Apart from the CDR, the company was also continuing talk with foreign currency convertible bond holders after it defaulted on bonds worth $ 221 million in October 2012. These talks with bondholders are separate from the CDR and will have to be dealt with at a later stage.
The company said they were working on solutions and it was too premature to comment. They were hopeful of sorting both these issues by the fourth quarter of this financial year.
Tanti was betting on lenders approving the corporate debt restructuring package they have filed and that would provide them with liquidity headwinds to stabilise their business.
Key priority remained improving working capital facilities and optimising working capital. After filing for CDR, few customers did express concern about business continuity, but it has not impacted order flows or business momentum, Suzlon CFO Kirti Vagadia told analysts.
On leveraging cash present in its German subsidiary, Tanti said there were no plans to leverage the cash at Repower as the company had taken loan facilities from German banks and these were ring-fenced. The Suzlon CFO also said that Repower was itself growing and needed cash to fund this growth.
The process of raising funds through sale of non-core assets was also