Tata Chemicals' Q2 FY2011-12 net profit up 116.5 per cent at Rs275 crore
EPS (diluted and non-annualised) at Rs10.81 per share
Q2 FY2011-12 consolidated financial highlights
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Net sales higher by 19.7 per cent at Rs3,571 crore.
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Profit from operations up 57.5 per cent at Rs674 crore compared to Rs428
crore.
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EBIDTA margins at 18.9 per cent.
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In Q2 FY2011-12, the company has not recognised subsidy income of
Rs14 crore on opening stock of raw materials for phosphatic and potassic
fertilisers, in accordance with the office memorandum issued by the
Department of Fertilisers (DoF) dated July 11, 2011. The matter is being
contested.
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PBT at Rs481crore vis-à-vis Rs250 crore.
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PAT (after minority interest) at Rs275 crore against Rs127 crore; up
116.5 per cent — includes impact of:
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EPS (diluted and non-annualised) at Rs10.81 per share.
Q2 FY2011-12 business highlights and initiatives
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Firm demand environment across major products with stable pricing situation.
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Improving realisations combined with efficient operations offset the
pressure exerted from rising input costs.
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Growth across all locations — domestic and international.
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Customised fertiliser witnessing healthy volume growth.
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Expansion of product portfolio enables 100 per cent growth in sales of
other agri inputs.
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i-Shakti pulses coverage extended to Karnataka and Gujarat.
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Increased strategic stake in EPM Mining Ventures to 30.6 per cent to
secure supplies and access low-cost sulphate of potash.
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Signed pre-construction services agreement with Technip SA for the Gabon
Fertiliser Project on a convertible lump sum turn key (LSTK) methodology
to ensure implementation of project within the best time and cost norms
of the industry.
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Formed Natronx Technologies in joint venture with FMC Corporation and
Church & Dwight, to set up a 450,000tpa manufacturing facility to produce
Trona sorbents with an overall investment of $60 million (TCL's share one-third).
Commenting on the company's Q2 FY2011-12 performance, R Mukundan, managing
director, Tata Chemicals, said:
"We are happy to report an extremely strong operational and financial
performance, given the challenging macro environment. All our businesses have
performed well. Particularly encouraging is the performance of our overseas
operations in the US, the UK and Kenya. While input prices remain firm, we
continue to see healthy demand outlook for soda ash business across markets.
All facilities are operating at high capacity-utilisation levels. The rehook
of the ammonia convertor at Babrala is expected to be completed by the end
of the current financial year. We are witnessing sustainable improvement in
our customised fertiliser business. Additionally, the sales of other agri
products increased by over 100 per cent on the back of an expansion in our
portfolio of offerings. We continue to widen our expansive urban and rural
reach as well as our product offerings.
We are also encouraged by the healthy performance of our consumer products
business with Tata Salt maintaining its dominant position with a 64 per cent
market share. During the quarter we also launched i-Shakti pulses in Gujarat
and Karnataka.
Overall, though rising input costs, a depreciating rupee and increasing interest
rates continue to exert pressure, our access to low-cost resources combined
with efficient operations and distribution will enable us to continue to drive
sustainable growth."
Business performance
Chemicals
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Domestic demand for soda ash stable — Sales to be impacted given
situation of rising interest rates.
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Normalised soda ash production at Tata Chemicals Europe — impact
of extreme winter during early January 2011 tapered down.
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Production, sales and realisations at British Salt continue to be robust
— brine cavities for gas storage further improve earnings performance.
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Tata Chemicals Magadi's improved performance driven by higher production
and better realisations for both, SAM and PAM despite higher consumption
of fuel and energy.
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Higher production volumes combined with renegotiated contracts improve
performance at Tata Chemicals North America.
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Tata Chemicals remains the market leader with 64 per cent market share
in the national branded segment.
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Strong demand for branded salt across the nation — branded salt
volumes growth at approximately 10 per cent.
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Offtake for i-Shakti range of pulses robust, backed by strong sales promotion
activities.
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Shutdown at Babrala plant for 15 days due to urea stripper and catalyst
replacement in methanator of ammonia plant — production post shutdown
has stabilised and the shortfall is being covered by high production levels.
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Customised fertiliser witnessed significant improvement in volumes.
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Sales volumes at IMACID registered a healthy growth — increase in
realisations to improve margin situation.