Ultratech Cement Limited · NSE:ULTRACEMCO
Ultratech Cement — Q3 FY21 Earnings Presentation
31 slides from Ultratech Cement's earnings presentation, Jan 23, 2021
Slide 1: Exchange filing cover letter
23rd January, 2021 BSE Limited The Manager Corporate Relationship Department Listing Department Phiroze Jeejeebhoy Towers, The National Stock Exchange of India Limited Dalal Street, “Exchange Plaza”, Bandra-Kurla Complex, Mumbai 400 001. Bandra (East), Mumbai 400 051. Tel.: 22721233/4 Tel.: 26598236
Slide 2: India's Largest Cement Company
India’s Largest Cement Company EARNINGS: Q3 FY21 23RD JANUARY 2021 Stock code: BSE: 532538 | NSE: ULTRACEMCO | Reuters: UTCL.NS | Bloomberg: UTCEM IS/UTCEM LX
Slide 3: Contents
Contents 01 02 03 04 ESG at Macro and Key updates Performance UltraTech Industry updates and highlights GLOSSARY: MNT – Million Metric Tons, LMT – Lakh Metric Tons, MTPA – Million Tons Per Annum, MW – Mega Watts, Q1 – April‐June, Q2 – July‐September, Q3 – October‐December, Q4 – January‐March, CY – C
Slide 4: UltraTech scores big on ESG
UltraTech scores big on ESG 68 59 15% • UltraTech’s score in S&P’s Dow Jones Sustainability 15 Index (DJSI) has improved by 9 points to 68 • UltraTech has retained its CDP score for Climate as “B”. This is the highest score for the Indian cement FY18 FY19 FY20 sector DJSI Score 3
Slide 5: Science Based Targets Initiative (SBTi)
Science Based Targets Initiative (SBTi) Kg CO2 per ton of cementious material 716 714 699 696 557 * 520 * 2017 2018 2019 2020 2030 2032 UltraTech joined the We are committed to build SBTi Target of ~27% growing list of companies our business in line with Reduction in CO2 emission adopting Science Ba
Slide 6: Boosting Circular Economy
Boosting Circular Economy Industrial waste material consumed during the year: Adopted innovative • Flyash ~12 MnT approaches during • Slag & Waste Gypsum ~1 MnT pandemic to build • Industrial Waste ~1 MnT our efforts on Circular Economy Long term arrangement with Hindalco Industries Ltd. for consumi
Slide 7: Increasing Green Power mix
Increasing Green Power mix 302 272 34% 28% 185 18% 125 103 13% 85 10% 7% FY19 FY20 FY21 FY22 FY23 FY24 FY19 FY20 FY21 FY22 FY23 FY24 WHRS Capacity (MW) Green Power Share (%) Total Green Power: 34% (WHRS: 26%, Solar: 8%) by FY 24 6
Slide 8: ESG at UltraTech
ESG at UltraTech People benefited: 1.6 million • The approach has been Education to restore normalcy, adhering to physical Education for: 0.1 million children distancing norms Social • Health camps, Covid‐19 Healthcare support Change CSR at Rural Health Camps for: 0.2 million people • Training on se
Slide 9: E-connecting Villages
E‐connecting Villages The digitalisation of villages help to make them smart and transform the life of villagers. • Distributed 60 computers to schools adjoining a plant • Students were supported with online classes at 14 locations and informal orientations Chhattisgarh 8
Slide 10: Macro and Industry updates
Macro and Industry updates Economic Driven by Strong macro Cement Urban Housing Government Recovery Quicker recovery Demand Smart recovery Thrust from Covid‐19 demand ahead Robust in urban Pick‐up in led disruption stablization, Strong Rural growth in housing infrastructure has been supply side Grow
Slide 11: Sectoral Update Q3 FY21
Sectoral Update Q3 FY21 State/Region wise performance Vol. State/Region I R H C Key drivers Gr. • IHB segment is witnessing increase in demand led North by Rural Housing • Infrastructure segment registered positive growth • IHB demand continues to be robust Central • Infrastructure segment registere
Slide 12: Q3 FY21: Key Performance Highlights
Q3 FY21 : Key Performance Highlights 1546 1330 26 22.82 21 1020 650 20.00 Q3FY20 Q3FY21 Q3FY20 Q3FY21 Q3FY20 Q3FY21 Q3FY20 Q3FY21 Sales Volume Operating EBITDA Operating Margin PAT (MnT) per MT % (Rs Crs) 14% 30% 5% 138% We Deliver what We Commit 11
Slide 13: Culture of Biodiversity is in our DNA
Culture of Biodiversity is in our DNA Continuous increase Developed and Initiated biodiversity in green cover at our finalized biodiversity assessment at three manufacturing plants management plan at more locations under Biodiversity two of our locations Management Plan Flora & Fauna in our factorie
Slide 14: UltraTech Nathdwara
UltraTech Nathdwara: since take over Capacity Utilization WHRS planned from: 45% to 75% 22 MW 2 MnT Grinding unit in UAE Disposal of consolidated remaining non‐ core assets in progress Production Cost EBITDA: reduction: Rs 90/mt > Rs 1500/mt 15% WeRock Deliver what Solid We Commit Performance 13
Slide 15: Acquisition update: Century Cement
Acquisition update: Century Cement WHRS planned Capacity utilization: 45 MW ~ 75% Volume growth: 37% YoY Completed 72% Brand Transition Power Production Cost consumption reduction: reduced by ~ 7% 12% YoY We Deliveron Performance what Weon track Commit all fronts 14
Slide 16: Strong Cash Flows
Strong Cash Flows Rs Crs Effective Working Capital Management : 16,860 Net Debt / EBITDA (India) Q3 release : Rs 780 Crs 0.73x 12,132 Capex Spends : Q3 : Rs 391 Crs 9,436 Net Debt Reduction YTD: Rs 7424 Crs Mar'20 Sep'20 Dec'20 Consolidated Net Debt/EBITDA reduced : Consolidated Net Debt 0.84x v/s 1
Slide 17: Key Performance Drivers: Q3 FY21
Key Performance Drivers: Q3 FY21 Capacity Utilization ~ 80% Increased sales network ~4%, up 11% YoY >75% appointed digitally Production cost Rural markets penetration down 1% QoQ increased by ~3.5% YoY Selling price Number of UBS outlets: ~2350 down 1% QoQ >70% new outlets in rural areas 16
Slide 18: Sales Performance: Q3 FY21
Sales Performance: Q3 FY21 MnT Q3 FY21 9M FY21 Particulars CY LY % CY LY % Domestic Sales 22.15 19.41 14 54.24 56.48 (4) (basis restated prior period) Exports and Others 0.67 0.59 13 1.74 1.77 (2) Total India Operations 22.82 20.00 14 55.98 58.24 (4) Consolidated Volume 23.88 20.90 14 58.59 60.89 (4
Slide 19: Key Cost Indicators: Q3 FY21
Key Cost Indicators: Q3 FY21 LOGISTICS COST ENERGY COST RAW MATERIAL COST 33% 27% 14% Increased 5% YoY to Rs. 1178/t Declined 3% YoY to Rs. 952/t Remained flat at Rs. 501/t • Diesel Price Hike – 10% YoY • Lower pet coke prices • Improved Clinker conversion • Change in Market Mix • Increased share of
Slide 20: Logistics Cost Trends
Logistics Cost Trends Logistics cost (Rs./t) 5% 1178 1140 YoY cost increased: 5% 1122 • Diesel price higher by ~10% • Due to change in market mix Q3FY20 Q2FY21 Q3FY21 Logistics costs v/s Diesel Price Index 125 129 QoQ cost increased: 3% 117 116 107 100 • Lower clinker to cement ratio 102 103 89 • Du
Slide 21: Strong move towards digitalization
Strong move towards digitalization Single Integrated Platform across the Value Chain …improving relationships with vendors & customers Manufacturing Logistics Improved capacity utilization Improved Service, Satisfied Customers & planning Safety, Order management driving sales Commercial Sales Custom
Slide 22: Energy Cost Trends
Energy Cost Trends Energy cost (Rs./t) YoY cost decreased: 3% 985 3% • Petcoke consumption at 44% and 952 imported coal consumption at 43% 937 • ‘Green power’ share in power mix raised to 13% (LY: 11%) • Reduced power consumption by 2% Q3FY20 Q2FY21 Q3FY21 QoQ cost increased: 2% Energy cost v/s Pet
Slide 23: Raw Material Cost Trends
Raw Material Cost Trends Raw Material cost (Rs./t) YoY cost remained stable 505 1% 501 • Improved clinker to cement 500 conversion ratio • Stable Raw material prices i.e. Flyash, Gypsum etc. Q3FY20 Q2FY21 Q3FY21 Conversion ratio and Fly ash Prices (Index) Trends 112 108 106 QoQ cost decreased: 1% 10
Slide 24: Other Cost Trends
Other Cost Trends Other Cost (Rs./t) 774 YoY cost decreased: 10% 67 Sabka 641 10% 639 Vishwas • Higher Volumes – 14% charge 701 • Lower Fixed Cost – 4% YoY Q3FY20 Q2FY21 Q3FY21 QoQ cost remained flat WPI (Index) Trend • Higher Volumes – 19% 108 110 100 • Fixed Costs normalized during the 108 quarter
Slide 25: Q3 FY21 Financial Performance
Q3 FY21 Financial Performance Rs. Crs UTCL Standalone India Operations Particulars CY LY % CY LY % Revenues (Net of Taxes) 11,708 9,816 19 11,698^ 9,800^ 19 Operating Income 122 166 (26) 127 200 (37) Other Income 262 164 60 254 141 81 Total Income 12,092 10,146 19 12,079 10,140 19 Expenses : Raw Mat
Slide 26: Income Statement: Q3 FY21
Income Statement : Q3 FY21 Rs Crs Consolidated India Operations Particulars CY LY % CY LY % 12144 10261 18 Revenues (net of taxes) ^ 11698 9800 19 3362 2147 57 EBITDA 3282 2046 60 28% 21% 7 Margin (%) 28% 21% 7 356 472 25 Finance costs 346 459 25 674 678 1 Depreciation & Amortization 637 647 2 233
Slide 27: EBITDA PMT Trends
EBITDA PMT Trends 1651 1478 198 1449 1438 65 70 108 1262 1251^ 1453 1159 1122 103 82 1051 1090^ 1036 89 131 70 98 926 98 1379 1330 57 1413 1159 1169 939 990 953 869 1069 1020 FY16 FY17 FY18 FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 FY20 Q1FY21 Q2FY21 Q3FY21 Operating Profit Other Income Total EBITDA Consiste
Slide 28: Financial Position
Financial Position Rs Crs Consolidated India Operations Particulars 31.03.2020 31.12.2020 31.03.2020 31.12.2020 61866 65431 Capital Employed (Excluding goodwill) 60182 64141 11.9% 13.4% ROCE * 12.1% 13.5% 12.3% 14.1% ROE* 11.9% 13.6% Effective ROE at 14.1% 27 * Basis trailing 12 months (excluding Go
Slide 29: Key Financial Ratio Trends: India Operations
Key Financial Ratio Trends : India Operations Particulars FY16 FY17 FY18 FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 FY20 Q1FY21 Q2FY21 Q3FY21 EBITDA Margin (%) 22% 24% 22% 19% 28% 23% 21% 25% 24% 32% 28% 28% Net Debt/EBITDA 0.23 (0.43) 1.85 2.64 2.19 2.00 1.74 1.55 1.55 1.44 1.11 0.73 Net Debt/Equity 0.05 (0.
Slide 30: UltraTech delivers carbon emission savings through critical infrastructure projects
UltraTech delivers carbon emission savings through critical Infrastructure projects ATAL TUNNEL, ROHTANG is one classic example of critical infrastructure that reduces the environment impact of the sensitive ecology of the valley. The project will benefit the society by carbon emission savings of ap
Slide 31: Disclaimer
Disclaimer Statements in this ‘presentation’ describing the Company’s objectives, estimates, expectations or predictions may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Impor