UltraTech Q1 net falls 38% as topline dips on lockdown woes

UltraTech Cement reported a 38% decline in first quarter consolidated net profit to ₹797 crore from a year earlier. Consolidated net sales also fell 33% to ₹7,563 crore, the company said in a filing with stock exchanges.

The company said it had emerged ‘stronger and well prepared’ in the wake of the ongoing COVID19 pandemic.

“UltraTech has managed the crisis with a sharp focus on operational efficiencies. In the available 68 operating days during this quarter, the company kept a tight control on costs and cash flow, and achieved an effective capacity utilisation of 60% across its network of 54 plants around the country,” it said.

It said that a general disruption due to the lockdown did impact business performance, but that ‘some encouraging trends’ were seen during the latter part of May, 2020, driven largely by better than expected pick-up in cement consumption in the rural markets.

The company said the ‘overheads control programme’ initiated by the management cut fixed costs by 21% year-on-year.

“Prudent working capital management and control on cash flows are reflected in a reduction of net debt by ₹2,209 crore during Q1 of FY21.”

The company said its capital and financial resources remained ‘entirely protected and its liquidity position was adequately covered’.