The India Cements Limited Announces Unaudited Results for the Quarter Ended 30th September 2018
Deepthi | Myequity news | Date : 09-11-2018 19:20:00 IST
The tough cement market conditions in south India arising out of regional imbalances in capacity coupled with steep increase in the prices of fuel and petroleum products along with depreciation of rupee against dollar all had an impact on the operating performance of the company during the period under review. The uptrend in cement production continued during the current year and as per the information published by DIPP, the cement industry had shown a growth of over 14% in April to September’18. Even south which had been reeling under pressure has registered a growth of over 20% in cement.
The operating performance of the company during the quarter had improved with a capacity utilization of 77% as compared to 70% in the same quarter of the previous year.
The cement sales of the company for the quarter under review was 30.10 lakh tons up by 11% and with a clinker sale of 0.67 lakh tons, the overall volume was at Rs.30.77 Lakh tons.
The NPR, however, was lower by 4 % when compared to same quarter of the previous year implying a bottom line erosion of Rs.38 crores for the quarter. The variable cost also had gone up by 8% on yoy basis and by 2% as compared to the quarter on sequential basis.
With the tight control on fixed cost particularly through reduction in manpower cost, freight and handling expenses, policy changes and such other actions, the company could achieve an EBIDTA of Rs.159 crores against Rs.188 crores in the previous year a drop of 18%.
The interest and other charges were at Rs.84 crores against Rs.89 crores in the previous year. There was a loss on account of forex fluctuation to the tune of Rs.12 crores during the current quarter and the depreciation was at Rs.62 crores against Rs.63 crores in the previous year. The resultant profit before tax was Rs.1.4 crores against Rs.36 crores in the previous year. Expansion:
The company has entered into a share purchase agreement on 28.10.18 for acquiring the entire share holding of Springway Mining Private Ltd. in a phased manner at a total cost of Rs.182.89 crores with an objective of setting up a Cement Plant in the State of Madhya Pradesh. Outlook:
The revival in economic momentum is expected to continue with a projected GDP growth rate of 7.4% in the current year. All the same, the economy is facing liquidity crunch and cost pressures due to increasing cost of fuel, pet coke and power and the hardening interest rates.
The pickup in cement demand witnessed after sluggish or nil growth for several years is expected to continue on the back of increasing consumption from infrastructure projects, roads, irrigation projects, private sector housing besides the Government’s push for affordable housing projects.
Also, the rural demand is expected to be good with the forecast of a good rainfall in the current North East monsoon. In general, we can expect good capacity utilization levels and better prices in the coming months.