UltraTech Cement first-quarter results

UltraTech Cement first-quarter results
Published: 27 July 2011

UltraTech Cement Limited, an Aditya Birla Group Company, today announced its unaudited financial results for the quarter ended 30 June, 2011. The results for Q1FY11 have been recasted to include Samruddhi Cement Ltd’s performance for a like-for-like comparison. The results are strictly not comparable with the corresponding period of the previous year.

Net Sales stood at INR4365 crores (US$991.234m) as compared to INR3,990 crores in the corresponding period of the previous year. Profit before Interest, Depreciation and Tax is  INR1254 crores and Profit after Tax is INR683 crores vis-a-vis INR1,086 crores and INR558 crores respectively, in the corresponding period of the previous year.

The combined domestic grey cement and clinker sales were 9.46Mt (9.61Mt).

The quarter was adversely impacted by the 30% increase in the domestic coal price in March, 2011. Alongside, imported coal price rose by 30% YoY resulting in a substantial escalation in costs.

The company has a capital outlay of over INR11,000 crores to be spent over the next three years. The capex pertain to a number of projects. These include clinker plants through brownfield expansion at Chhattisgarh and Karnataka together with additional grinding units, the installation of waste-heat recovery systems;  bulk packaging terminals and the establishment of ready-mix concrete plants. Orders have been placed for major equipment for setting up of the projects. These expansions are expected to be operational by Q1FY14 and will enhance the company’s cement capacity by 9.2Mt.

In terms of the outlook, the company expects the surplus scenario within the Indian market is likely to continue over the next 2-3 years resulting in the selling prices remaining under pressure. With commodity prices rising, input costs will be affected, which will squeeze margins.