UltraTech Cement announces results for the quarter ended 30 September 2009

1st November, 2009

16 October 2009

UltraTech Cement announces results for the quarter ended 30 September 2009

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(Rs. crore)
 30 September 200930 September 2008Change (in per cent)
Net sales1,5411,39610
PBIDT50132554
Profit after tax (PAT)25116453

UltraTech Cement Limited, an Aditya Birla Group company, today announced its unaudited financial results for the quarter ended 30 September 2009.

Financials
The company achieved net sales of Rs. 1,541 crore (Rs. 1,396 crore). Profit before interest, depreciation and tax at Rs. 501 crore (Rs. 325 crore) rose by 54 per cent while profit after tax at Rs. 251 crore (Rs. 164 crore) registered a growth of 53 per cent. Though the results reflect an improvement over Q2 FY09, lower demand particularly in the markets of southern India, coupled with surplus capacity adversely affected the company’s performance sequentially.

Cement production at 3.73 MMT (3.33. MMT) was higher by 12 per cent. Domestic cement sales volume at 3.58 MMT (3.23 MMT) reflected a growth of 11 per cent. Overall variable cost was lower by 16 per cent on account of softening in fuel prices and enhanced share of power from the captive thermal power plants.

Corporate development
The Board received a proposal dated 3 October 2009 from Samruddhi Cement Limited (Samruddhi), a wholly owned subsidiary of Grasim Industries Limited (Grasim), the company’s holding company, informing the Board about the demerger of Grasim’s cement business and a potential consolidation of Samruddhi and the company. The Board at its meeting held on 6 October 2009, having found the proposal attractive, constituted and authorised a Committee of Directors and Officers of the company to inter alia evaluate and consider the proposal in consultation with legal and financial advisors. The Committee is expected to revert to the Board with its recommendations by the first week of November 2009.

Directors
At the meeting held today, the Board re-appointed Mr. S. Misra as the Managing Director upto 31 March 2010.

Capex
The company has a capital outlay of around Rs. 2000 crore. This will be spent over the next two years, mainly for setting up of a 25MW thermal power plant at its unit in Awarpur, Maharashtra; an additional grinding and evacuation facility at its unit in Gujarat; Waste Heat Recovery Systems across units for generating power out of waste gases.

Outlook
Despite a weak monsoon, industry demand may grow at 9 per cent in FY 10 given the government’s initiatives to boost rural development, infrastructure and housing. The new capacities in the sector, which are at various stages of commissioning, will inevitably result in pressure on margins.

The company’s focus on higher volume growth, captive power generation and capital productivity should partially offset the impact on 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