ACC net doubles to Rs180 cr in Q2 as dealers restock
20 October 2017
ACC net profit more than doubled in the July-September 2017-18 quarter to Rs182 crore, against Rs90 crore in the comparable quarter of the previous fiscal, on the back of lower base, restocking of cement by dealers post demonetisation and better realisation.
Profit before tax was up 46 per cent at Rs482 crore while sales turnover for the July-September 2017-18 quarter rose 18 per cent to Rs3, 329 crore.
Operating EBITDA improved by 38 per cent to Rs637 crore while operating EBITDA margin stood at 19 per cent against 16 per cent in the previous year quarter.
Revenue from operations were up 10 per cent at Rs3,117 crore (Rs2,843 crore).
"ACC's efforts to clarify value propositions and customer-focused guidance has driven significantly better commercial performance. The direction for both cement and ready-mix businesses has been to harness current strengths and develop new competencies which resulted in the launch of new brands and sharpened the plant performances. We are confident about the prospects of our company," said Neeraj Akhoury, managing director and CEO of ACC.
"ACC aims to be the preferred partner for projects supporting government priorities of infrastructure, affordable housing and building smart cities," he added.
This strong result has been achieved through an increased focus on premium products, the company said.
Akhoury said the company is working with the LafargeHolcim group to adopt best global practices on commercial transformation and cost management.
''Cement sales of the company increased 18 per cent during the quarter. The stabilisation of Jamul and Sindri plant capacities have contributed to this growth. Premium product volumes grew by 18 per cent YoY,'' the company said.
Despite rising cost, the company's focus on operational efficiencies helped to rationalise cost and add to bottom lines. ''Higher usage of imported and auctioned coal, caused by the limited availability of linkage coal, adversely impacted fuel costs. However, improved raw material mix and fuel mix optimisation helped to partially neutralise the adverse cost impact,'' it said.
ACC's 'ready mixed concrete' business maintained a steady growth trend of 11 per cent over the same quarter of the previous year largely through supplies to diversified customer segments.
Three new commercial plants in Mumbai, Pune and Jharkhand were commissioned duringthe quarter. ACC now has 57 operational RMC plants in India and concrete is being supplied to diversified customer segments such as high-mid Rise, individual home buyers (IHB), Metro, power, road projects, industrial segments and more.
The company expects demand for cement and related products to stay on course in the coming quarter spurred by the government's increased spending on infrastructure, particularly roads, highways and affordable housing.