ACC Limited, one of the country's top cement manufacturers, on July 14 reported a 60 percent decrease in consolidated profit after tax of Rs 227 crore for the second quarter ended June 2022 from Rs 569 crore in the corresponding quarter of the previous financial year.
On a sequential basis, profit declined by 42.6 percent from Rs 396 crore in the previous quarter. The company follows a January-December financial year.
According to a CNBC TV18 Poll, the street was expecting a net profit of Rs 396 crore.
Revenues
Consolidated revenue came in at 15 percent higher at Rs 4,468 crore for the quarter, up from Rs 3,885 crore in the year-ago period. On a QoQ basis, the revenue grew marginally by 0.9 percent from Rs. 4,427 crore in the previous quarter.
The consensus estimate for consolidated revenues for the quarter according to the CNBC TV18 poll was Rs 4,358 crore.
The quarter was impacted by the moderation in demand and prices as well as elevated costs of power and pet coke.
Costs
The company witnessed a surge in overall costs of production as compared to previous quarters which impacted its bottom line in the reported quarter.
The cost of raw materials as a percentage of revenue from operations jumped 250 bps from the year ago period to 15.5 percent. The surge in power & fuel costs dented the margins the most as they jumped by 8 percent from the same period year ago and ~6 percent from the previous quarter to 29.4 percent of the revenue. The impact of rising fuel prices was also felt on the freight costs which increased by 40 bps on both the yearly as well as quarterly basis to 24.1 percent of the revenues.
However, the improvement in operational efficiencies helped the company bring savings in its employee costs and other expenses which were marginally lower than previous quarters.
Margins
EBITDA (earnings before interest, tax, depreciation and amortization) for the current quarter came in at Rs 426.23 crore which was down 51 percent from the EBITDA of Rs 869.4 crore reported during the same period last year.
The CNBC TV18 poll of analysts had projected an EBITDA of Rs 448.2 crore for the quarter.
Consequently, EBITDA margins tanked drastically to 9.4 percent for the quarter ended June 2022 compared to the EBITDA margins of 22.4 percent achieved during the year ago period.
The street was expecting an EBITDA margin of 10.3 percent as per the CNBC TV18 poll.
On July 14, the stock closed Rs 13.25 lower at Rs 2,160.30 on the National Stock Exchange. It has been trading flat over the past one year.
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