Ultratech Cement Limited · NSE:ULTRACEMCO
Ultratech Cement — Q4 FY19 Earnings Presentation
29 slides from Ultratech Cement's earnings presentation, Apr 25, 2019
Slide 1: Exchange filing cover letter
24th April, 2019 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. Sandra (East), Mumbai 400 051. Tel.:2272 1233/34 Tel.:26598236 Fa
Slide 2: India's Largest Cement Company - Quarterly update, Q4 FY19
INDIA’S LARGEST CEMENT COMPANY Quarterly update, Q4 FY19 Stoc k c ode: BSE: 532538 | NSE: ULT RACEM CO | Reuter s : UT CL .NS | Bloom ber g: UT CEM IS/UT CEM LX
Slide 3: Contents
Macro and Sector updates Key Company updates CONTENTS Performance Sectoral guidance GLOSSARY MNT – Million metric tons LMT – Lac metric tons MTPA – Million tons per annum Q1 – April-June Q2 – July-September Q3 – October-December Q4 – January-March 9M – April-December CY – Current year period LY – Co
Slide 4: Macro indicators
Macro indicators Q3 GDP IIP growth for Average crude Appreciation in WIP stood at contracted to April-February prices for the INR v/s US$ 3.0% v/s 4.5% 6.6% v/s 7.7% 2019 period: quarter of ~2% over during Q3 in LY 4% (LY: 4.4%) lowered ~8% Q3 FY19 FY19 v/s Q3 FY19, but up 21% in FY19 UltraTech Ceme
Slide 5: The industry in its upcycle with double-digit volume for full-year
Sector updates The industry in it’s upcycle with double-digit volume for full-year, the first time since FY10 Industry demand growth and capacity utilization trend Cap.Utilisation Industry growth trend ~15% ~14% Capacity utilisation for Q4 ~14% ~12% reached its highest level in ~12% ~ 10% the last
Slide 6: Key cement industry growth drivers Q4 FY19
Sector updates Key cement industry growth drivers Q4 FY19 Infrastructure Low-cost housing Housing Industrial & commercial Growth drivers ~22% ~12% ~54% ~12% Growth Road execution Major construction High double digit Office space Key contributors speed now at ~ 30 projects in Madhya growth in housing
Slide 7: State/region-wise performance
Sector updates State/region-wise performance Vol. State/Region I LCH RH UH C Key drivers Gr. Haryana Urban Housing and Infrastructure Delhi + NCR Infrastructure Punjab Panchayat elections and sand availability Himachal Pradesh Heavy rains & snow Rajasthan Infrastructure North Infrastructure and IHB
Slide 8: State/region-wise performance
Sector updates State/region-wise performance State / Region Vol. Gr. I LCH RH UH C Key Drivers West Bengal IHB Bihar Infrastructure and IHB Jharkhand Infrastructure and PMAY Odisha Infrastructure and IHB Chhattisgarh Heavy rains and shortage of funds East Infrastructure, IHB and PMAY Andhra Pradesh
Slide 9: Buoyant demand-supply environment supported price hikes
Sector updates Buoyant demand-supply environment supported Average cement prices improved price hikes in majority of the markets ~ 1-2 % over Q3 Region Eastern India Western India Northern India Southern India Central India Demand Growth Change* Price Flat + 2% Flat + 4 to 5% + 1% * QoQ Change in pr
Slide 10: Key steps for integration of UltraTech Nathdwara (UNCL)
UltraTech updates Key steps for integration of UltraTech Nathdwara (UNCL) Emerged as a sector benchmark by turning around the asset within a quarter Stabilised operations with Improved pet coke usage Carried out routine plant capacity from Zero to ~ 40% during maintenance activity utilization at 72%
Slide 11: The next steps for integration of UNCL
UltraTech updates The next steps for integration of UNCL Benchmark safety Step-by-step Kick-start a cost Strengthen dealer Synergize logistics norms to emulate capacity ramp-up reduction program network to create and procurement UltraTech to take utilisation in order to improve 1,000+ strong costs s
Slide 12: Acquisition of Century's cement assets
UltraTech updates Acquisition of Century’s cement assets National Company Final order from Transfer of Likely Law Tribunal National Company limestone mines to be concluded completion hearing scheduled Law Tribunal on 3rd May 2019, likely in May / after the final in Q2 FY20 following the June 2019 or
Slide 13: We deliver what we promise: Deleveraging the balance sheet
At UltraTech, We deliver what we promise Focus on Deleveraging the Balance Sheet EBITDA-to cash Achieved a Reduced conversion Rs. 900 Crs leverage by ratio improved reduction in 0.73x in the at ~ 93% working capital quarter Generated free cash flow of ~ Rs. 2180 crore during the quarter UltraTech Ce
Slide 14: Net debt and borrowings trend
At UltraTech, We deliver what we promise 98.8@ 98.8 89.0* 89.0 3.44 70.3 2.36 2.09 2.71 (0.04) Mar'17 Sep'17 Mar'18 Dec'18 Mar'19 Consolidated Net Debt EBDITA Consolidated Capacity (mtpa) India Operations : 2.50x * Acquisition of 21.2 mtpa capacity Jun’17 @ Acquisition of 6.25 mtpa capacity in Nov’1
Slide 15: UltraTech Performance – India Operations
UltraTech Performance – India Operations All-round performance Domestic Volume (million tonnes) Turnover (Rs Crs) 69.70 35128 57.75 28930 20.47 10299 17.64 17.33 8750 8742 Q4 18 Q3 19 Q4 19 FY 18 FY 19 Q4'18 Q3'19 Q4'19 FY 18 FY 19 Operating EBITDA (Rs Crs) PAT (Rs Crs) 6597 2376 5883 988 2282 488 3
Slide 16: Key factors behind Q4 performance
UltraTech Performance Key factors behind Q4 performance Increased Increased Improved Enhanced Opened ~110 Price Optimised penetration sales sales contribution USB outlets improvement costs on the deeper into volumes of volumes of of value- during the of 1-2% back of a the retail blended ready-mix ad
Slide 17: Q4 sales performance – India Operations
Q4 sales performance – India Operations We deliver what we promise MnT Q4 Annual Particulars CY LY % CY LY % Capacity (mtpa) 94.8 85.0 12 94.8 85.0 12 Domestic sales 20.47 17.64 16 69.70 57.75 21 Exports and others 0.83 0.82 1 3.00 2.90 4 Total 21.30 18.47 15 72.70 60.65 20 A year of robust volume
Slide 18: Operating costs
Operating costs 34% 31% 14% of total of total of total cost cost cost Logistics costs : Energy Costs: Raw material costs Lower 2 % y-o-y to up 7 % y-o-y to remained flat y-o-y to Rs. 1146/t Rs. 1057/t Rs. 472/t: • Lower diesel prices • Currency depreciation of 10 % • Improved blending ratio impacted
Slide 19: Logistics cost trends
Logistics cost trends Logistics Costs (Rs/t) Sequential costs decrease 2 % due to: 1,169 Full benefit from axle load relaxation 1,166 Reduction in diesel prices 7% (Gain: Rs.15/t) 1146 Increased movement through railways Costs increased somewhat owing to: - A marginal increase in lead distan
Slide 20: Energy cost trends
Energy cost trends Energy Costs (Rs/t) Q-o-Q costs decrease 4 % due to: Reduction in blended price of (imports/domestic) 1,105 pet coke by 7% 1057 Share of renewable energy in overall power mix 987 increased : 100 bps Consistent improvement in auxiliary consumption norms of thermal power plant
Slide 21: Raw materials cost trends
Raw materials cost trends Raw Materials Costs (Rs/t) Q-o-Q costs decrease 4% due to: 491 Savings resulting from a growing share of 473 472 value-added products Increasing usage of low-cost materials Y-o-Y costs remain flat due to: Impact of additional limestone royalties negated by savings fro
Slide 22: Other costs trends
Other costs trends Other Costs (Rs/t) Q-o-Q costs decrease due to: 679 Last quarter included impact of one-time plant 595 575 improvement cost and annual maintenance cost in some plants Cost synergies with the acquired capacities Q4 18 Q3 19 Q4 19 Note: Performance represents blended cost for In
Slide 23: Income statement Q4 (Domestic)
Income statement Q4 (Domestic) Rs. Crs. Standalone India Operations* Particulars CY LY % CY LY % Revenues (net of taxes) 10334 8750 18 10299 8750 18 EBITDA 2353 1814 30 2406 1814 33 Margin (%) 23% 21% 2 23% 21% 2 Finance costs 371 340 (9) 426 340 (25) Depreciation 499 481 (4) 526 481 (9) PBT 1483
Slide 24: Income statement - Consolidated
Income statement- Consolidated Rs. Crs. Q4 FY Particulars CY LY % CY LY % Revenues (net of taxes) 10739 9168 17 36775 30541 20 EBITDA 2459 1892 30 7227 6734 7 Margin (%) 23% 21% 2 20% 22% (2) Finance costs 434 349 (24) 1549 1238 (25) Depreciation & Impairment 547 590 7 2140 1968 (9) PBT 1477 727 1
Slide 25: Operating EBITDA per ton bridge
Operating EBITDA PMT BRIDGE Rs. Per ton 68 1072 141 68 25 769 Q3FY19 Realisation Logistics Costs Energy Costs Raw Materials & Q4FY19 Other Costs Operating EBITDA improved ~ 40% over Q3 FY19 Note: Performance represents India operations at blended level UltraTech Cement Limited 24
Slide 26: Financial Position
Financial Position Rs. Crs. Consolidated Standalone Particulars 31.03.19 31.03.18 31.03.19 31.03.18 28401 26397 Shareholders funds 27948 25923 22818 19480 Loans 18118 17420 3542 3173 Deferred tax liabilities 3544 3174 54761 49051 Sources of funds 49610 46517 46243 42296 Fixed assets 40193 40782 2847
Slide 27: Free Cash Flow - FY19
Free Cash Flow- FY19 Rs. Crs Consolidated Particulars Standalone 4978 Operating Cash Profit (Net of Tax) 4852 (817) Change in Working Capital (686) 4161 Cash Flow from Operations (I) 4167 (1660) Capex (II) (1511) 2501 Cash Surplus (I+II) 2656 UltraTech Cement Limited 26
Slide 28: Sectoral outlook
Sectoral outlook Demand expected to move above the national GDP rate Demand Price Key things to drivers drivers watch out for Infrastructural Improvement in Outcome of development utilisation rates General Elections 2019 Low-cost housing Incremental programme – Plan demand exceeding Mons
Slide 29: 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