NEW DELHI: On the back of weak operational performance and rising energy and logistics costs, UltraTech Cement reported a 9 per cent dip in its September quarter net profit to Rs 390.8 crore. The Aditya Birla Group-promoted firm had reported Rs 431.2 crore profit in the same period last year.
“Rising energy and logistics costs, coupled with rupee depreciation, resulted in costs increasing by 14 per cent as compared to Q2FY18, bringing down profits YoY,” UltraTech said.
Power and fuel costs went up 30 per cent to Rs 1,886 crore and freight and forwarding expenses jumped 25 per cent to Rs 1,946.9 crore YoY, the company said. Other expenses during the quarter increased 19.8 per cent to Rs 1,058 crore.
UltraTech’s revenue rose 21 per cent to Rs 7,771.3 crore, while earnings before interest, tax, depreciation and amortisation (EBITDA) declined 6.7 per cent to Rs 1,207.6 crore. Operating margin contracted 460 basis points to 15.5 per cent.
The company, in its quarterly results, announced that it has successfully completed the integration of 21.2 mtpa cement capacity acquired in July 2017. Its cement manufacturing capacity, including that of overseas operations, will stand augmented at 111.1 mtpa, it said.
Cement stocks fall
As the two leading manufacturers, Ultratech and ACC, reported lower-than-expected operating performance for Q2, shares of cement companies fell by up to 8 per cent on the BSE in intraday trade.
Shares of ACC, which recently announced its Q2 results, fell by 7.32 per cent to Rs 1,427.20 on Friday. The company had reported a 15 per cent growth in its net profit at Rs 205 crore against average analyst expectation of Rs 234 crore for the quarter.
Ultratech, which also missed analysts’ expectations, saw its stock going down by 3.24 per cent at Rs 3,609.45 per share on Friday, while Dalmia Bharat and Shree Cement hit their respective 52-week lows on the BSE. Ambuja Cement too closed 4.15 per cent lower than the previous trading day. (With inputs from PTI)