Consolidated net sales were Rs. 10 176 crores compared to Rs. 10 294 crores over the corresponding period in FY19. Profit before interest, depreciation and tax was Rs. 2 141 crores vis-à-vis Rs. 1 707 crores, and profit after tax was Rs. 712 crores compared to Rs. 396 crores.
Acquisition of Century’s cement business
The Scheme of Demerger for acquiring the cement business of Century Textiles and Industries Limited became effective from 1 October 2019. The company’s financials were restated from 20 May 2018, to include the financials of the acquired Century cement business, in terms of the National Company Law Tribunal, Mumbai Bench, sanctioning the Scheme of Demerger.
The plants have been ramping up production month on month, touching a capacity utilisation of 79% in December 2019. The company has put in place a cost reduction plan to bring the operations in line with its existing standards. 55% of sales from the Century plants in December were under the UltraTech brand. Brand integration is underway and is expected to reach 84% by Q2FY21. The overall integration is likely to be completed by end of Q2FY21. Given its vast experience in integrating acquired units and bringing them up to its operating standards, the company is confident on replicating the same at the acquired Century cement plants.
During the quarter, the company’s wholly-owned subsidiary, UltraTech Cement Middle East Investments Limited, divested its entire shareholding in Emirates Cement Bangladesh Limited and Emirates Power Company Limited to HeidelbergCement Bangladesh Limited at a final Enterprise Value of BDT equivalent of US$30.2 million.
UltraTech Nathdwara Cement Limited
UltraTech Nathdwara Cement Limited is fully integrated with the UltraTech systems and processes. The plants have achieved optimal efficiencies and are PBT accretive.
Acquisition in FY18
The 21.2 million tpy cement capacity acquired from Jaiprakash Associates in June 2017 is operating in line with the existing plants of the company. Phase I of the Bara Grinding Unit, with a capacity of 2 million tpy, has been commissioned.
Signs of revival were visible in some markets during the latter part of Q3FY20. This, together with the government’s firm commitment to reviving the economy and the thrust on infrastructure spending, augur well for the growth of cement demand. UltraTech, with its presence across all the zones in the country, is positioned to take advantage of the revival in cement demand.
Read the article online at: https://www.worldcement.com/indian-subcontinent/05022020/ultratech-cement-announce-financial-results-for-quarter-ended-december-2019/