NE BUSINESS BUREAU
CHENNAI, NOV 8
UltraTech Cement Ltd. owned India Cements Ltd reported a net loss for the September quarter on Friday. Net loss for the quarter stood at ₹240 crore, which is triple of the ₹81.4 crore loss the company had reported in the same quarter last year.
For the half year, the loss after tax, including other comprehensive items, was at ₹203 crore as against a loss of ₹155 crore in the first half of last year.
- The sharp decline in selling prices resulting in drop in NPR by 13% impacted the margins resulting in a negative EBIDTA of Rs.154 crores
- The capacity utilisation of the company improves during the 2nd quarter to 59% from 50% in the first quarter despite the tight market conditions and free fall in cement prices
- Sales decline 18.40% to Rs 1,031.80 crore
The company’s performance in both Q2 and the first half of this fiscal year was heavily impacted by weak cement demand and a significant decline in prices. Cement demand remained sluggish, showing negative growth in Q1 and only a 3 per cent rise in Q2, leading to an overall growth of 1.6 per cent from April to September—well below last year’s growth rate of over 10 per cent, said a statement.
Revenue for the quarter declined by 17% on a year-on-year basis to ₹1,017 crore from ₹1,222 crore during the year-ago quarter.
Though the operating performance improved during the second quarter with an increase in volume by 17 per cent as compared to the first quarter of the current year, the sharp decline in selling prices resulting in a drop in NPR (net plant realisation) by 13 per cent impacted the margins resulting in a negative EBIDTA of ₹154 crore for the second quarter. In the year-ago period, the the company’s EBIDTA stood at ₹14 crore.
India Cements also noted that it could not fully leverage lower fuel costs, particularly pet coke, as low volume levels eroded margins.
In Q2, cement volumes were 23.02 lakh tonnes, down slightly from 23.70 lakh tonnes in Q2 FY24, though up from 19.61 lakh tonnes in Q1 of this fiscal. For the first half of this fiscal, volumes stood at 42.63 lakh tonnes, down from 50.36 lakh tonnes a year ago.
