UltraTech reports financial results for the year ended 31st March, 2019

24 April, 2019

  • Sales Volumes Up 18 per cent over Q3
  • Net Profits Soar 148 per cent over Q3
  • Operating EBITDA Jumps 63 per cent over Q3

Benefits of Acquisition Getting Reflected in Earnings

(Rs. in crores)
  Standalone India operations Standalone
Q4FY’19 Q4FY’18 Q3FY’19 Q4FY’19 FY’19 FY’18
Net Sales 10,334 8,750 8,685 10,299 35,105 28,930
PBIDT 2,353 1,814 1,515 2,406 6,992 6,483
PAT 1,017 488 449 988 2,456 2,231

(Rs. in crores)
   Consolidated
Q4FY’19 Q4FY’18 Q3’FY19 FY’19 FY’18
Net Sales 10,739 9,168 9,205 36,775 30,541
PBIDT 2,459 1,892 1,558 7,227 6,734
PAT 1,013 446 413 2,435 2,222

UltraTech Cement Limited, an Aditya Birla Group company, today, announced its financial results for the quarter and year ended 31st March, 2019.

Financials:

Q4FY19

Domestic Net Sales rose 18 per cent to Rs.10,334 crore from Rs.8,750 crore over the previous year. Profit before interest, depreciation and tax was Rs.2,353 crore vis-à-vis Rs.1,814 crore in the corresponding period of the previous year. Profit after tax was Rs.1,017 crore compared to Rs.488 crore in the corresponding period of FY17-18.

Domestic Sales volume jumped 16 per cent over Q4FY18. The clinker capacity and cement grinding facility at Manavar, District Dhar, Madhya Pradesh have stabilised with the clinker capacity operating at 100 per cent utilisation. Variable costs were up 3 per cent over Q4FY18 on account of higher fuel prices and impact of rupee depreciation; it was down 7 per cent compared to Q3FY19.

FY19

For the full year, Net Sales rose 21 per cent to Rs.35,105 crore from Rs.28,930 crore over the previous year. Profit before interest, depreciation and tax was Rs.6,992 crore vis-à-vis Rs.6,482 crore in the corresponding period of the previous year. Profit after tax was Rs.2,456 crore compared to Rs.2,231 crore in the corresponding period of the previous year.

Highlights:

Acquisition of Binani Cement Limited (BCL) in FY19

From 20th November, 2018 BCL has become a wholly-owned subsidiary of the Company. It has been re-named UltraTech Nathdwara Cement Limited (UNCL), from 13th December, 2018.

The acquisition provides the Company access to large reserves of high quality limestone. It consolidates the Company’s leadership in the fast growing northern and western markets in the country. A major overhauling of the plants was undertaken in Q4 to improve production efficiencies. The plants have been ramping up on capacity utilisation, achieving 72 per cent in the month of March, 2019. After completing quality upgradation, the ‘UltraTech’ brand has been successfully launched from the erstwhile Binani plants.

The Company is in the process of selling the non-core assets acquired in UAE / China, the sale proceeds of which will be used to deleverage the balance sheet.

Acquisition in FY18

With the successful integration of the 21.2mtpa cement capacity acquired from Jaypee Associates in June, 2017 and subsequent improvements carried out, these plants are now operating in line with the existing plants of the Company.

The acquired plants are now running at a capacity utilisation of 82 per cent. A planned shutdown was undertaken at Bela (Madhya Pradesh) plant for cost improvements, the benefits of which will be fully achieved in Q1FY20. Having achieved a cash break even already, the acquisition is now on course to achieve a PBT break even in line with the plan.

The acquisition is generating incremental earnings as planned, which are growing month on month. As the next phase of improvement, it is now proposed to invest in Waste Heat Recovery System (WHRS) plants. Work on the 4.0mtpa Bara Grinding unit is on track and the first phase of the expansion is expected to be commissioned during this quarter.

Corporate Developments

The Scheme of Arrangement amongst Century Textiles and Industries Limited (Century), the Company and their respective shareholders and creditors (the Scheme), is now awaiting the approval of the National Company Law Tribunal and other regulatory authorities as may be required.

Upon completing this acquisition and with the on-going capacity expansions, the Company's cement manufacturing capacity will stand augmented to 113.4mtpa, in India, strengthening its position as the 3rd largest cement player globally (excluding China).

Dividend

The Board of Directors at their meeting held today recommended dividend of 115 per cent at the rate of Rs.11.50/- per equity share of face value of Rs.10/- per share, aggregating Rs.315.84 crores. The Company will absorb dividend distribution tax amounting to Rs.64.92 crores, resulting in total payout of Rs.380.76 crores.

Outlook

The cement industry started witnessing pick-up in demand since FY2018 achieving double digit growth since the last 2 years, after a period of tepid growth. However, there continues to be relatively low increase in new capacity. Incremental capacity added during the year has been 12mtpa against incremental demand of around 38 million tons, which resulted in improving industry capacity utilisation and will further help in improving the demand-supply balance.

The Government’s thrust on infrastructure development viz. construction of cement concrete roads, metro rail networks, airports, DFC, irrigation projects and increase in the pace of execution under the low cost housing program, supported strong volume off-take. With stabilisation of RERA, pick-up in urban housing is also being witnessed. All of these are expected to result in sustained demand growth for cement going forward. This augurs well for the industry.

UltraTech, with its expansions in the last 3 years is very well placed to participate in the growth of the economy.

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