ACC has stated that its net sales for 4Q18 grew by 11% to INR37.9 billion compared to INR34.2 billion in 4Q17. Operating EBITDA registered a growth of 15% to INR5.1 billion, compared to INR4.4 billion in 4Q17, despite sharp cost headwinds. Operating EBITDA for FY18 was INR21.2 billion, compared to INR19.1 billion in FY17, which was an increase of 11%.
For the cement business, a sales volume growth of 8% was delivered for 4Q18, compared to 4Q17. It is thought that this was driven by stronger demand trends and a greater focus on premium products.
Despite the rising prices of slag, petcoke, and diesel, the company has stated that its continued emphasis on productivity measures improved raw material mix. In addition, source mix optimisation helped to partially offset higher input costs, resulting in improved performance in the quarter.
Fixed costs, selling general and administrative expenses were also lower than 4Q17.
Significant growth has been registered in the company’s ready-mixed concrete business, with growth in volumes of 15% during the year. It is thought that this was achieved through a focus on profitable construction segments and value added solutions delivered to large projects. 18 new plants being set up during the year also contributed to the volume growth.
In its recently announced budget for 2019, the government has indicated its commitment to further augment the infrastructure sector (railways, roads, highways, and irrigation projects). It is expected that the government’s concerted efforts to increase investment across several sectors will have a favourable impact that will stimulate cement demand and boost economic growth. It is hoped that this will open up more opportunities, with cement, as a core sector, continuing to benefit from India’s growth story.
“ACC has demonstrated its capacity to execute multiple strategies and strengthen the culture of protecting its reputation and driving competitive advantage,” said Neeraj Akhoury, Managing Director and CEO of ACC. “ACC has delivered profit before tax growth of 21% for FY18 and 22% for 4Q18. Over the last quarter, net sales growth was 11% and operating EBITDA growth was up by 15%. This proportional growth of EBITDA was achieved by executing a set of priorities, both on revenue and cost levers, improving efficiency and strengthening our customer and market approach. This enabled us to improve our performance continuously over the last several quarters. We are excited to continue this growth momentum as we add new cement capacities of 5.9 million t through a greenfield integrated cement plant at Ametha in Madhya Pradesh, with a grinding unit in Uttar Pradesh and the expansion of our Tikaria and Sindri plants.”
Read the article online at: https://www.worldcement.com/indian-subcontinent/08022019/acc-releases-its-financial-results-for-4q18/
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