Hindalco announces Q2FY 2013-14 standalone results

Hindalco, the flagship company of Aditya Birla Group, today announced its unaudited results for the quarter ended September 30, 2013.

Operational performance in Q2FY14 improved over Q2FY13 as well as over Q1FY14. The average aluminium LME in Q2FY14 d;ropped by around 3 per cent and 7 per cent respectively from the levels seen in Q1FY14 and in Q2FY13. The decline was offset by the depreciating Rupee.

The performance of Copper Business has improved significantly compared to Q1FY14.

The results of Q2FY14 include a non-recurring income of Rs.61 crore and a dividend of Rs.100 crore from subsidiary companies. Other income was impacted by lower treasury yield due to liquidity tightening.

Finance costs were higher, given higher average borrowing.

Business results

Aluminium
Aluminium sales grew by 11 per cent to Rs.2,343 crore from Rs.2,105 crore in Q2FY13 on the back of higher volumes. Aluminium EBIT stood at Rs.166 crore against Rs.170 crore in Q2 FY13.

Total metal production stood at 132 Kt (excluding production at Mahan) for the quarter compared to 128 Kt in Q2FY13. Production of Alumina (excluding production at Utkal Alumina) in Q2FY14 was higher at 334 Kt vs.328 Kt in Q2FY13, but was lower compared to 348 Kt in Q1FY14 mainly due to a planned ramp down at one of the refineries.

Value-added product sales stood at 65 Kt vs. 62 Kt in Q2FY13 and 59 Kt in Q1FY14. The Silvassa Foil plant continues to be under lock-out. An application for closure of Silvassa Foil plant has been filed on 3rd October, 2013 before the concerned authorities.

The capital employed in the Aluminium Business was nearly Rs.34,300 crore as on September 30, 2013, of which around Rs.25,120 crore pertained to the Greenfield investments, viz., Mahan, Hirakud FRP and Aditya Aluminium Projects.

Copper
Copper sales stood at Rs.3,974 crore, with EBIT at Rs.239 crore vs. Rs.209 crore in Q2FY13 and Rs.81 crore in Q1FY14.

Cathode production was at 77 Kt as against 78 Kt in Q2FY13 and 68 Kt in Q1FY14. The value-added CCR production was maintained at 36 Kt vs. 37 Kt in Q2FY13.

The capital employed in Copper Business was around Rs.5,375 crore.

Greenfield projects
The production ramp-up at Mahan smelter and at Utkal Alumina refinery is underway as planned. In Q2FY14, the Mahan smelter produced 7.4 Kt metal and Utkal refinery produced 41 Kt of hydrate as alumina equivalent.

The Aditya Aluminium smelter is in an advanced stage of completion and is gearing for the first metal tapping.

Company outlook
The long spell of subdued LME has adversely affected the global aluminium industry and its margins and production levels significantly. Greenfield projects are ramping up as planned, however EBITDA streams will take time to scale up with delayed access to captive coal. With improving TcRc, Copper business is expected to have a stable outlook despite a sharp d;rop in by-product realisation.

Disclaimer : Statements in this “Press Release” describing the company’s objectives, projections, estimates, expectations or predictions may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the company’s operations include global and Indian demand supply conditions, finished goods prices, feed stock availability and prices, cyclical demand and pricing in the company’s principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which the company conducts business and other factors such as litigation and labour negotiations. The company assume no responsibility to publicly amend, modify or revise any forward looking statement, on the basis of any subsequent development, information or events, or otherwise.