Ultratech Q3 net rises over 5% to Rs594.61 cr despite a dip in sales

UltraTech Cement Ltd, India's largest cement maker, has reported consolidated net profit of Rs594.61 crore for the fiscal third quarter ended 31 December, a 5.13 per cent increase year-on-year, on higher income.

The company has reported consolidated net profit of Rs565.61 crore for the October-December 2015-16 quarter.

Ultratech said its other income rose 9.69 per cent to Rs97.47 crore from Rs88.86 crore a year ago.

Net sales, however, dropped 2.53 per cent to Rs5,927 crore from Rs6,013 crore.

Profit before interest, depreciation and tax stood at Rs1,280 crore compared to Rs1,274 crore in the corresponding period of the previous year.

On a standalone basis, net sales dropped 1.98 per cent to Rs5,540 crore compared to Rs5,652 crore in the corresponding period of the previous year.

Profit before interest, depreciation and tax on a stand-alone basis was Rs1,210 crore compared to Rs1,204 crore in third quarter of FY16. Profit after tax was up 6.63 per cent at Rs563 crore in Q3FY17 against Rs528 crore in the third quarter of FY16.

Earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 0.14 per cent year-on-year to Rs1,113.46 crore. EBITDA/tonne, however, rose 2.11 per cent to Rs1011.31 crore. Margins expanded by 40 basis points to 19.85 per cent during the quarter.

The improvement in margins is mainly on account of a sharp reduction in power and fuel costs by 10 per cent to Rs968.85 crore in December quarter.

The company's board approved plans to set up a 3.5 million tonnes per year integrated cement plant at Dhar, Madhya Pradesh. The plant will be built at a total cost of Rs2,600 crore, the company said.

Commercial production from the new unit is expected to commence by the fourth quarter of fiscal year 2019.

UltraTech hopes to cater to the markets of south-west Madhya Pradesh, where the company is not a significant player, through this plant.

With this expansion and the acquisition of the cement plants of Jaiprakash Associates, the company's cement capacity will stand augmented to 95 mtpa including its overseas operations.