Concerning cement sales, there was subdued construction activity throughout the monsoon season, causing the industry as a whole to experience a weak off-take of cement in the quarter. Due to this, ACC’s cement volumes were correspondingly flat and selling prices were subdued.
Sales of ready-mixed concrete have maintained a consistent upward trend over the last two years, with growth continuing to be logged in 3Q15 in terms of both sales volumes and profitability. The focus was on value-added products and strengthened customer orientation.
During 3Q15, total consolidated sales turnover was INR2740 crore. This is almost equal to the same quarter the previous year. Operating EBITDA was INR313.2 crore, compared to INR379.08 crore the previous year. Although sales realisation was almost flat, there was an improvement in input and energy costs. During 3Q15, provisions were made towards contribution to the District Mineral Foundation and National Mineral Exploration Trust, amounting to INR38 crore. The company is continuing to focus on cost management.
Thus far, the pace of economic revival has been slower than expected. It is hoped that over the next year trends such as the recent cut in interest rates, softening of energy prices, control of inflation and the government’s efforts to stimulate investment across several sectors will have a favourable impact on improving the overall economic environment in the country. This will hopefully then provide an impetus for construction activity and open up more opportunities for growth in the cement industry.
Adapted from press release by Rebecca Bowden