UltraTech Cement Ltd, flagship company of Aditya Birla Group, reported a lower-than-expected consolidated net profit of Rs 1,775 crore in March quarter, down 45 per cent from the corresponding period last year even as net sales jumped. The company reported consolidated net profit of Rs 3,243 crore in March 2020.
Net sales of the Aditya Birla Group company stood at Rs 14,405 crore in the final quarter of FY21, up 33 per cent from same period last year on strong demand for the commodity.
As per Bloomberg estimates, the company’s topline was expected to be at Rs 13,460 crore, while the bottomline is estimated to be at Rs 1,644 crore in the period under review.
Tax expenses worth Rs 865 crore ate into the company earnings in the period under review, in turn dragging the bottomline.
In the corresponding period last year, the nearly Rs 2,000-crore deferred tax credit provided firm support to the company's bottomline taking the profits to over Rs 3,000 crore.
UltraTech, during the quarter, reduced net Debt/EBITDA ratio to 0.55x from 1.72x as on March 31, 2020, which is in line with its endeavour to maintain optimal capital structure. EBITDA is earnings before interest, taxes, depreciation and ammortisation.
The loan repayments have been made through free cash flows that the company has generated during the year, despite the challenging circumstances and severe business interruptions during Q1FY21, informed the company via release.
Meanwhile, the company raised $400 million (approximately Rs 2,900 crore) by way of issuance of unconditional, unsubordinated and unsecured USD denominated notes (in the form of “Sustainability Linked Bonds”), due 16th February, 2031 at 2.8 per cent per annum, payable semi-annually on August 16 and February 16 of each year, commencing from August 16, 2021 as per applicable laws. The Bonds are listed on the Singapore Exchange Securities Trading Limited.
On capacity expansion, the company's Board had earlier sanctioned capacity expansion plans of 19.5 million tonne through a mix of brown field and green field expansion covering 5 integrated cement plants and 12 grinding units.
"Most of the orders for equipment have been placed and civil work has also commenced at these locations," informed the company.
Commercial production from these capacities is expected to go on stream in a phased manner, during FY22 and FY23.
Going ahead, the company said, while rural and semi-urban housing continue to drive growth, pick-up in government led infrastructure aided incremental cement demand. Pent-up urban demand is also expected to improve.
Meanwhile, the company is closely monitoring the impact of the second wave of the pandemic on its operations. With its focus on operational efficiencies and cost control, UltraTech is better prepared for any resulting slowdown in the economy, it said today.
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