UltraTech full-year net profit down 6% YoY

UltraTech full-year net profit down 6% YoY

India’s largest cement manufacturer UltraTech Cement reported a six per cent drop in its net profit for the year ended 31 March 2015 to INR20.15bn versus INR21.44bn in the previous year. Net sales were 13 per cent at INR22,656 crore against INR20,078 crore in the previous year.

The Aditya Birla group firm noted that although there was some relief from softening coal prices, the cost of limestone and other input materials continued to remain high, putting pressure on margins. “The company continues to optimise its fuel mix and other operating costs,” UltraTech said in a statement.

Full-year grey cement and clinker sales were 44.85Mt.

Fourth-quarter performance
For the fourth quarter ended 31 March, 2015, the company reported a net profit of INR6.15bn against INR8.38bn, which included previous year’s tax provision reversal of INR960m. The January-March quarter net profit included additional provision of INR500m for deferred tax, due to increase in surcharge on income-tax.

Combined Indian cement and clinker sales for clinker under the group’s Indian operations was 11.81Mt.

Acquisition update
During the year the company completed the acquisition of Jaypee Cement Corp’s Gujarat units, comprising an integrated unit at Sewagram and a grinding unit at Wanakbori with a combined capacity of 4.8Mta. The Board of Directors had earlier approved the acquisition of the cement units of Jaiprakash Associates Ltd situated in Bela and Sidhi in Madhya Pradesh, which together have a capacity of 4.9Mta with 180MW of thermal power capacity. The transaction is subject to approval of shareholders and creditors of both companies and sanctions by the high courts. The Competition Commission of India has already approved the transaction.

Coal block e-auction
The company also participated in the Central government’s e-auction for the allocation of coal blocks. UltraTech has been awarded the Bicharpur coal block situated in Madhya Pradesh. With reserves of 29.12Mt, it will provide fuel security for the company’s plants within the vicinity of the mines for 30 years, UltraTech highlighted.

Commissionings 
During the final quarter the company commissioned a 2Mta clinker plant in Shambupura, Rajasthan, a 10MW waste heat recovery system at Shampura, Rajasthan and a 6MW waste heat recovery system at Malkhed, Karnataka.

In addition to the projects commissioned during 4QFY15, the following projects were also commissioned during the year:
• 25MW thermal power plant at Malkhed, Karnataka
• 25MW thermal power plant at Tadipatri, Andhra Pradesh
• 6.5MW waste heat recovery system at Awarpur, Maharashtra
• 1.4Mta cement mill at Rajashree Cement, Karnataka.

Outlook
On its outlook for the year, UltraTech said that with the government’s focus on the development of infrastructure and the housing sector, the company is positioned across India “to meet the rise in demand and participate in the next phase of growth in the country.”