National Fertilizers Ltd. · NSE:NFL
National Fertilizers — FY2016-17 Earnings Presentation
42 slides from National Fertilizers's earnings presentation, May 2017
Slide 1: National Fertilizers Limited Financial Performance for FY 2016-17
NATIONAL FERTILIZERS LIMITED FINANCIAL PERFORMANCE FOR THE FINANCIAL YEAR 2016-17
Slide 2: Brief on Plants and Trading Activities
BRIEF ON PLANTS AND TRADING ACTIVITIES UREA Vijaipur-II Vijaipur-I Bathinda Panipat Nangal CAPACITY (LMT)– 32.31 LMT 8.646 8.646 5.115 5.115 4.785 After Revamp – 35.68 LMT 10.662 9.999 5.115 5.115 4.785 Capacity utilization (2016-17) w.r.t. RAC 131.7% 122.4% 111.1% 106.2% 104.9% COMM. PRODUCTION 31s
Slide 3: Performance Highlights
PERFORMANCE HIGHLIGHTS Ever highest production of urea of 38.10 LMT with an overall capacity utilization of 117.9% against previous best of 37.99 LMT with an overall capacity utilization of 117.6% during CPLY#. Ever lowest energy consumption at Panipat, Bathinda, & Vijaipur-II units. Energy cons
Slide 4: Production of Urea
PRODUCTION OF UREA Unit Urea Production in LMT On stream Days 2016-17 2015-16 2016-17 2015-16 Nangal 5.02 5.47 316 342 Panipat 5.43 5.67 334 348 Bathinda 5.68 5.48 349 336 Vijaipur I 10.58 9.92 349 328 Vijaipur II 11.39 11.45 338 347 Total 38.10 37.99 Company achieved ever best production of 38.10
Slide 5: Production of Industrial Products
PRODUCTION OF INDUSTRIAL PRODUCTS (with one stream in operation) QTY IN MT Products 2016-17 CPLY Increase/ (Decrease) Nitric Acid 75479 53804 21675 Ammonium Nitrate (Melts)* 8989 - 8989 Sodium Nitrate/ Nitrite 3151 2641 510 * The raw material for Ammonium Nitrate is Ammonia and Nitric Acid Increas
Slide 6: Purchase of Other Fertilizers
PURCHASE OF OTHER FERTILIZERS Particulars Unit 2016-17 CPLY Increase/ (Decrease) DAP @ MT 214203 50770 163433 BS # MT 3419 1481 1939 Compost MT 2690 - 2690 Agro Chemicals Nos. 39250 - 39250 Seeds Qtls. 54298 62876 (8578) (details in next slide) 1. Higher quantity of DAP & BS was purchased for tradin
Slide 7: Purchase of Seeds
PURCHASE OF SEEDS In Quintals Particulars 2016-17 CPLY Increase/ (Decrease) Breeder Seeds 58 - 58 Foundation Seeds 2184 1964 220 Certified Seeds * 8228 - 8228 Seeds (Third Party 43828 60912 (17084) certified) Total 54298 62876 (8578) * Soya Bean, Paddy and Wheat 7
Slide 8: Energy Consumption (Gcal/MT of Urea)
ENERGY CONSUMPTION (GCAL/MT OF UREA) Units Energy Norms FY 2016-17 FY 2015-16 Nangal 7.095 7.012 7.012 Panipat 7.614 7.112 7.259 Bathinda 7.479 6.925 7.003 Vijaipur I 5.904 5.783 5.750 Vijaipur II 5.569 5.364 5.410 Ever lowest energy consumption at Panipat, Bathinda, & Vijaipur-II units. Energy
Slide 9: Sales – All Products
SALES – ALL PRODUCTS Items Unit FY FY Variance with FY 2016-17 2015-16 CPLY (%age) 2014-15 Sale of UREA LMT 37.58 36.41 3 36.87 SALE OF DAP LMT 2.14 0.51 321 - SALE OF BS MT 3356 1481 127 866 Seeds Qtls. 53032 62876 (16) 44062 Compost MT 2660 - 100 - Agro-Chemicals Nos. - 100 - 25350 Nitric Acid MT
Slide 10: Overall Performance FY 2016-17
OVERALL PERFORMANCE FY 2016-17 `Crore 2016-17 CPLY Increase/ Remarks Particulars (Decrease) Actual Actual With CPLY Sale quantity of urea (LMT) 37.58 36.41 1.17 Gross Sale of urea is lower due to Gross Sales of urea 6767.12 7364.41 (597.29) reduction in gas price by 19% and Sale of other products
Slide 11: Detail of Expenses
DETAIL OF EXPENSES `Crore Particulars FY 2016-17 CPLY Increase/ Remarks (Decrease) Production of urea (Qty. in LMT) 38.10 37.99 0.11 Increase by 0.29% Dispatches of urea (Qty. in lakh MT) 37.81 37.15 0.66 Increase by 1.78% Sale of Urea (Qty. in Lakh MT) 37.58 36.41 1.17 Increase by 3.21% Cost of Mat
Slide 12: Finance Cost
FINANCE COST ` Crore Particulars FY 2016-17 CPLY Increase/ (Decrease) Interest on Long Term Loans 13.80 22.97 (9.17) Interest on working capital Loans 163.33 192.52 (29.19) Other borrowing costs* 12.62 12.93 (0.31) Total finance cost 189.75 228.42 (38.67) Less: Interest earned on deposits 7.10 5.40
Slide 13: Variance Analysis - Interest on Working Capital Loans
Variance Analysis- Interest on working capital loans Particulars 2016-17 2015-16 Average Rate Average Rate Utilization Utilization (` Crore) (` Crore) CP 2122.68 6.91% 2074.39 7.81% CC 121.35 8.94% 206.70 9.70% STL 40.39 8.08% 109.40 9.55% SBA 140.43 1.75% - 0.00% Average 2424.85 6.74% 2390.49 8.05%
Slide 14: Steps Taken to Reduce Interest Cost
STEPS TAKEN TO REDUCE INTEREST COST NFL negotiated with many banks for lowering interest rate on borrowings. New Banks such as The Bank of Nova Scotia, CTBC Bank and Shinhan Bank were also introduced having low interest rate on STL. Pursued with DoF rigorously since Jan 2016 for STL through Speci
Slide 15: Product Wise Profitability
PRODUCT WISE PROFITABILITY Particulars FY 2016-17 CPLY ` crore % of PBT ` crore % of PBT Urea 234.86 72.3% 264.25 91.6% Industrial 39.11 12.0% 19.06 6.6% Products (IP) Traded Goods 50.91 15.7% 5.11 1.8% etc. Total 324.88 100% 288.42 100%
Slide 16: Profit Variance Analysis
PROFIT VARIANCE ANALYSIS ` Crore Profit / (Loss) before tax for the year ended 31st 324.88 March 2017 Profit / (Loss) before tax for the year ended 31st 288.42 March 2016 Increase in Profit 36.46 Profit has increased due to various reasons (A) 172.52 Profit has decreased due to various reasons (B) 1
Slide 17: Profit Variance Analysis
Contd. From pre-page PROFIT VARIANCE ANALYSIS ` crore A: Reasons for increase in Profit 1 Increase in contribution from urea * 45.75 Increase in profit from traded goods (due to higher sale of 46.09 2 DAP and improvement in the margins) 3 Decrease in net Finance cost 40.37 Increase in contribution f
Slide 18: Profit Variance Analysis
Contd. From pre-page PROFIT VARIANCE ANALYSIS ` crore B : The above increase in profit has been off-set by the following: 1 Increase in marketing expenses 37.79 2 Increase in salary and wages 30.90 3 Higher receipt/ accountal of past period subsidy arrears in CPLY 30.31 4 Increase in Security expens
Slide 19: Unit Wise Profit/(Loss) Before Tax
UNIT WISE PROFIT/ (LOSS) BEFORE TAX (PBT) ` Crore Unit 2016-17 2015-16 Nangal 7.89 (10.31) Panipat 49.89 36.04 Bathinda 57.14 26.72 Vijaipur-I 37.34 60.66 Vijaipur-I 121.71 170.20 Traded Goods and CO 50.91 5.11 Total 324.88 288.42 Profit at Nangal unit after a gap of 4 years. Profit at Nangal Unit
Slide 20: Debt to Equity Ratio
DEBT TO EQUITY RATIO ` Crore S. Particulars As on As on No. 31st March 31st March 2017 2016 1 Long term Borrowings 980.88 1828.30 2 Short term Borrowings * 3153.73 4295.32 3 Total Borrowings 4134.61 6123.62 4 Borrowings pertaining to AFCP 744.76 1490.77 (Urea) excluded being reimbursed by GoI 5 Net
Slide 21: Key Financial Ratios
KEY FINANCIAL RATIOS S. Particulars 2016-17 CPLY No. 1 Earning Per Share (`10/- each) 4.24 4.05 2 Earning Per Share (`10/- each) (after considering OCI) 4.23 3.92 3 Return (Total Comprehensive Income) on Net Worth 11.35 11.37 4 EBITDA/Gross Sales 7.83 7.74 5 EBITDA/Average Capital Employed 6.20 5.61
Slide 22: Key Financial Indicators
KEY FINANCIAL INDICATORS ` crore S. Particulars 2016-17 CPLY No. 1 Gross sales (including subsidy) 7663.22 7793.91 2 EBDITA 599.80 603.50 3 Profit before tax 324.88 288.42 4 Profit after tax 208.16 198.62 5 Total comprehensive income 207.33 192.20 6 Net worth 1826.64 1690.75 7 Debt (for D:E ratio ca
Slide 23: National Fertilizers Limited
NATIONAL FERTILIZERS LIMITED PBT ` 324.88 crore and PAT ` 208.16 crore is highest during the last 14 years. Moreover, in terms of Ind AS 8, opening Reserves has been increased by ` 33.77 crore during the year ended 31st March,2017. (i.e. increase ` 58.66 crore on account of adjustment relating t
Slide 24: Comparative Analysis of EBDITA of Top Four Years
Comparative analysis of EBDITA of top Four years of High Financial Performance since 1978-79 ` Crore PARTICULARS FY 2016-17 FY 2015-16 FY 2002-03 FY 1993-94 EBDITA 599.80 603.50 687.02 525.52 Adjustment of OCI (1.27) (9.82) (-) Depreciation written 268.00 back included in above ` (-)Arrears of Subsi
Slide 25: Reconciliation of PAT and Total Comprehensive Income under IGAAP and Ind AS
Reconciliation of PAT and Total Comprehensive Income under IGAPP and Ind AS ` Crore Sr. Particulars 2016-17 CPLY 1 Net Profit/(Loss) after tax as per previous GAAP 206.73 197.09 (Indian GAAP) 2 Add/(Less) adjustments for Ind AS: 2.1 Actuarial gain/(loss) on defined benefit plans 1.27 9.83 recognized
Slide 26: Financial Performance for the Quarter Ended Mar-17
FINANCIAL PERFORMANCE FOR THE QUARTER ENDED MAR-17
Slide 27: Production of Urea
PRODUCTION OF UREA Unit Urea Production in LMT On stream Days Jan – Mar Jan – Mar CPLY CPLY 2017 2017 Nangal 1.19 1.27 75 79 Panipat 1.44 1.43 83 86 Bathinda 1.38 1.49 83 89 Vijaipur I 2.56 2.59 85 83 Vijaipur II 2.72 2.98 80 91 Total 9.29 9.76
Slide 28: Production of Industrial Products
PRODUCTION OF INDUSTRIAL PRODUCTS QTY IN MT Unit JAN – MAR CPLY Increase/ 17 (Decrease) Nitric Acid 19003 17716 1287 Ammonium 2500 - 2500 Nitrate Sodium Nitrate/ 614 548 66 Nitrite Increase in production of industrial products was driven by higher demand. 28
Slide 29: Purchase of Other Fertilizers
PURCHASE OF OTHER FERTILIZERS Particulars Unit JAN – MAR 17 CPLY Increase/ (Decrease) DAP @ LMT - - - BS # MT - 150 (150) Seeds Qtls. 17638 471 17167 Compost MT 184 - 184 Agro Chemicals Nos. 39250 - 39250 Compost and Agro Chemicals (As of now 20 Molecules) was added to the trading list. @ Diammonium
Slide 30: Energy Consumption (Gcal/MT of Urea)
ENERGY CONSUMPTION (GCAL/MT of UREA) Units Energy Norms Jan – Mar 2017 CPLY Nangal 7.095 6.813 7.112 Panipat 7.614 6.978 7.240 Bathinda 7.479 6.928 6.977 Vijaipur I 5.904 5.884 5.691 Vijaipur II 5.569 5.445 5.357 Energy consumption at all the Units was within Energy norms fixed under NUP-2015. E
Slide 31: Sales – All Products
SALES – ALL PRODUCTS Items Unit Jan – CPLY Variance with Mar 2017 CPLY (in %age) UREA LMT 8.71 8.59 1 DAP LMT 0.09 0.02 323 Seeds Qtls. 16372 545 2904 Compost MT 1350 - 100 Agro-Chemicals Nos 25350 - 100 Nitric Acid MT 17510 17737 (1) Ammonium Nitrate MT 2485 - 100 Sodium MT 720 565 27 Nitrate/Nitri
Slide 32: Overall Performance
OVERALL PERFORMANCE ` Crore For the quarter CPLY Increase/ Remarks Particulars 31.03.2017 (Decrease) Actual Actual With CPLY Sale quantity of urea (LMT) 8.71 8.59 0.12 Sale of urea (qty.) increase by 1.40% Gross Sales of urea 1787.72 1553.87 233.85 Gross Sale of urea is higher due to higher sale
Slide 33: Details of Expenses
Details of Expenses Amount in `Crore Jan – Mar Increase/ Remarks Particulars CPLY (Decrease) 2017 Production of urea (Qty. in 9.29 9.76 (0.47) Lower stream days LMT) Dispatches of urea (Qty. in 8.81 9.22 (0.41) - LMT) Sale of Urea (Qty. in LMT) 8.71 8.59 0.12 - Cost of Materials consumed 838.98 799.
Slide 34: Finance Cost
FINANCE COST ` crore Particulars Jan – Mar 2017 CPLY Increase/ (Decrease) Interest on Long Term Loans 2.14 5.53 (3.39) Interest on working capital 30.36 60.66 (30.30) Loans Other borrowing costs 3.91 7.40 (3.49) Total finance cost 36.41 73.59 (37.18) Less: Interest earned on 0.23 0.74 (0.51) deposit
Slide 35: Profit Variance Analysis
PROFIT VARIANCE ANALYSIS ` Crore Profit / (Loss) before tax for the quarter ended 31st March 2017 122.06 Profit / (Loss) before tax for the quarter ended 31st March 2016 47.02 Increase in Profit 75.04 Profit has increased due to various reasons (A) 112.16 Profit has decreased due to various reasons
Slide 36: Profit Variance Analysis
Contd.. From pre-page PROFIT VARIANCE ANALYSIS ` Crore A: Reasons for increase in Profit 1 Increase in contribution from urea * 44.12 2 Decrease in net finance charges (net of impact of earned from 36.67 deposits) mainly due to lower interest cost under Special Banking Arrangement in the March -17 q
Slide 37: Profit Variance Analysis
Contd.. From pre-page PROFIT VARIANCE ANALYSIS ` Crore B : The above increase in profit has been off-set by the following: 1 Increase in salary and wages 14.43 2 Increase in marketing expenses 9.03 3 Decrease in contribution from sale of Industrial Products 4.81 4 Increase in repairs and maintenance
Slide 38: Indian Accounting Standard (Ind AS)
INDIAN ACCOUNTING STANDARD (Ind AS) First Time adoption of Ind AS The notified Indian Accounting Standards (Ind-AS), includes Ind AS-101 relating to “First-time adoption of Indian Accounting Standards”, wherein the principles / detailed guidelines has been given for transition from Indian GAAP to In
Slide 39: Indian Accounting Standard (Ind AS)
Continued from pre-page INDIAN ACCOUNTING STANDARD (Ind AS) For transition from IGAAP to Ind AS, Ind AS-101 allows certain optional exemption to ease out the transition and the Company has considered these optional exemptions available and used the below optional exemption in preparation of standalo
Slide 40: Impact of Ind AS on Financial Statements
Impact of Ind AS on Financial Statements Property, Plant and Equipment (Ind AS 16) It requires that all items of spares having a life of more than one year need to be capitalized as part of the Property, Plant and Equipment (PPE). Accordingly, stores and spares which meet the above criteria has been
Slide 41: Impact of Ind AS on Financial Statements
Continued from pre-page Impact of Ind AS on Financial Statements Income Taxes Ind AS 12 requires recognition of deferred tax asset or liability based on the Balance Sheet approach and allows recognition of deferred tax on all the temporary differences between the Book base and Income Tax base. Accor
Slide 42: Thank You
THANK YOU
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