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UltraTech Cement’s profits rise despite increased energy and logistics costs

World Cement,

UltraTech Cement’s financial results for FY12

UltraTech Cement, part of the Aditya Birla Group, has released its results for the financial year ending 31 March 2012. The results reveal an increase in net profits from Rs.15 406 crores in FY11 to Rs.18 166 crores in FY12. Profit after tax also rose from Rs.1719 crores to Rs.2446 crores. Sales of both grey cement and clinker and white cement experienced growth, reaching 40.73 million t and 5.6 million lakh t, respectively.

The company noted an increase in variable costs, which rose by 13%. These included rising coal prices, as well as growing logistics costs following the hike in railway freight prices.

Results 4Q12

Net sales of cement rose from Rs.4490 crores in 4Q11 to Rs.5337 crores in 4Q12, whilst profit after tax grew to Rs.867 crores. Sales of white cement stood at 1.6 million lakh t, whilst sales of grey cement and clinker increased to 11.54 million t.

Cement and clinker expansion plans

Clinkerisation plants, grinding units and bulk packaging facilities are under construction in Chhattisgarh and Karnataka. These projects, which are due to commence operation in FY14, will increase the company’s 52 million t cement capacity by 10.2 million tpa.

Cement industry forecast

The cement sector is predicted to grow by more than 8% due to government infrastructure development projects. The company also expects a continued surplus in the cement sector over the next three years, as well as squeezed margins as input costs increase.

Adapted from press release by Louise Fordham.

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