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UltraTech Results: Ultratech Cement Quarterly Results (Q1:2021-22),Earnings

UltraTech Results: Ultratech Cement Quarterly Results (Q1:2021-22),Earnings

Last updated: 23 Jul, 2021 | 11:38 am

UltraTech Results: Ultratech Cement Quarterly Results (Q1:2021-22),Earnings

Profit up 114% YOY, shattering estimates: UltraTech Cement reported a sharp 114% rise in its consolidated Net Profit for the quarter ended June 2021 at Rs 1,700 crore as compared to Rs 794.2 crore in the same quarter last year. Analysts had estimated profits to be around Rs 1,145 crore. The strong bottomline performance in the quarter was aided by the low base of the year-ago quarter when the national lockdown adversely affected the company’s performance. However, on a sequential basis the net profits dropped 4.17% from Rs 1774 crores last quarter. 

Revenue Growth: Consolidated revenue in Apr-Jun 21 quarter rose 54.2% to Rs 11,830 crore as against Rs 7,671.1 core, YoY. The Grey Cement and RMC segments’ revenue rose 51% and 291% respectively boosting the revenue on a yearly basis.

UltraTech Cement Quarterly Results: Important highlights

Margin boost: The Company’s EBITDA during the quarter increased 59.2% to Rs 3,307.5 crore from Rs 2,077.7 crore last year, while EBITDA margin improved by 88 bps to 27.96% from 27.05%, YoY. The operational performance was also better than estimates. However, operating profit declined 10% sequentially due to sequential rise in power and fuel expenses at 20.5% of net sales compared with 18.8% in the preceding quarter.

Debt Reduction: UltraTech has reduced its net debt significantly. With efficient operations and judicious working capital management, the company paid in advance long-term loans amounting to Rs 5,000 crore in July using the free cash flows available. Net debt fell by Rs 736 crore during the quarter ended June and stood at Rs 5,984 crore as against Rs 6,720 crore in the last quarter and Rs 14,651 crore a year ago.

Capacity: UltraTech's capacity utilization for Apr-Jun quarter was at 73% against 46% in the same quarter last year. The company’s expansion program is on track and estimated to be completed by the end of FY23. On completion, the capacity will be augmented to 136.25 MT. Covid did cause some delays due to labour shortages and lockdowns. However, the company expects to commission all the projects as per the original schedule

Ultratech Cement Quarterly Results Review:

UltraTech Cement expects demand to grow on the back of the government's thrust on infrastructure, and the expanding rural economy. As the economy limps back to recovery, UltraTech will be a major beneficiary, with a strong market position, huge capacity and efficient cost management. UltraTech’s Sales volume stood at 21.5 million tonnes, up 46.9% year-on-year on a low base, but declined 22.5% sequentially.  The volume trends also depict that the company has been able to sail through the pandemic without many difficulties. With projections of a likely third wave, the company is closely monitoring the situation. It remains cautiously optimistic, given its inherent financial and operational resources and the government’s continuing thrust on infrastructure activities and housing constructions.

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