Financial results for the quarter ended 31 December 2011

1st February, 2012

21 January 2012

Financial results for the quarter ended 31 December 2011

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UltraTech Cement Limited, an Aditya Birla Group company, today announced its unaudited financial results for the quarter ended 31 December, 2011.

Financials –; Q3FY'12
Net sales stood at Rs. 4,572 crores as compared to Rs. 3,715 crores in the corresponding period of the previous year. Profit before Interest, Depreciation and Tax (PBIDT) is Rs. 1,120 crores and Profit after Tax (PAT) is Rs. 617 crores vis-a-vis Rs. 768 crores and Rs. 319 crores respectively, in the corresponding period of the earlier year.

The combined domestic cement and clinker sales of grey cement was 9.72 MnT (9.16 MnT) while it was 2.49 LmT (2.25 LmT) for white cement and wall care putty.

The quarter witnessed improved demand growth of around 10 per cent on account of a lower base effect in the corresponding period of the previous year. The sector capacity utilisation during the quarter improved to 73 per cent as compared to 68 per cent in the preceding quarter. Although post-monsoon, the pricing scenario indicated some improvement, the uncertain price scenario is expected to continue.

Variable cost rose by 16 per cent, mainly on account of increase in energy cost. This is attributable to the 30 per cent rise in the price of domestic coal by Coal India during Q4FY11; continuous spike in prices of imported coal as also the rupee devaluation by approximately 14 per cent. Energy cost is expected to escalate with the change in pricing mechanism from Useful Heat Value (UHV) to Gross Calorific Value (GCV) implemented by Coal India with effect from 1 January 2012. All of these will put pressure on the company's margins.

Capex
The company has a capital outlay of over Rs. 11,000 crores to be spent on various projects. These include, among others –; clinkerisation plants through brownfield expansion at Chhattisgarh and Karnataka together with additional grinding units –; installing waste-heat recovery systems –; instituting bulk packaging terminals –; setting up of readymix concrete plants. The progress on expansion of capacity at Chhattisgarh and Karnataka are almost in line with the schedule. These are expected to be operational by Q1FY14, and will augment the company's cement capacity by 9.2 mtpa bringing it to a total of 59 mtpa.

These projects are being funded through a judicious mix of internal accruals and borrowings.

Outlook
Demand is likely to grow around 8 per cent. However, the surplus scenario is likely to continue over the next three years. At the same time, growing input costs will result in a squeeze in margins.

For more information, contact:
Dr. Pragnya Ram
Group Executive President
Corporate Communications & CSR
Aditya Birla Management Corporation Private Limited
Tel: 91-22-6652 5000 / 2499 5000
Fax: 91-22-6652 5741/ 42
Email: pragnya.ram@adityabirla.com