PRESS
RELEASE |
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July
31, 2003 |
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ANALYSIS OF RESULTS FY 2003 1. Operational Performance All cement plants operated at good utilisation levels resulting in higher clinker production by 41% at 8.6 million tonnes as against 6.1 million tonnes in the previous year. This record increase in production was as a result of quick stabilisation of the 2 million tonne plant at Chandrapur in Maharashtra. Higher clinker production resulted in increased cement production by 37% at 9.8 million tonnes as against 7.2 million tonnes. Cement sales registered an increase of 37% to 9.8 million tonnes as against 7.2 million tonnes last year. Domestic sales were higher by 35% to 7.98 million tonnes from 5.93 million last year and exports registered 46% at 1.83 million tonnes as against 1.25 million tonnes. 2.Sales Realisation Low cement prices prevailing in all our markets resulted in domestic sales realisations dropping by 9%, while export realisations improved marginally by 1%. This resulted in the overall sales realisation dropping by 8% despite which the fall in Operating Margin was restricted to only 4%. 3.Other Income Other income during the year was high as compared to the previous year on account of better returns on the deployment of surplus funds, prudent forex management as well as increase in quantum of funds deployed. 4.Costs Cost of production has gone down further particularly power and fuel cost. The power and fuel cost per tonne of cement is down by about 3%. Freight cost has moved up on account of commissioning of the Maharashtra plant where the lead distances are higher as compared to the other plants. Freight cost per tonne of cement has increased by 21%. 5.Operating Margin The operating profit of the company is Rs 5,128 million as against Rs.4,658 million in the previous year an increase of 10%. However, the operating margin declined during the year to 30% against 34% in the previous year. The drop in operating margin was only 4% despite cement realization dropping by 8% on account of higher productivity, reduction in power, fuel coupled with operational efficiencies. 6.Interest The interest expenses during the current year reduced by 9% to Rs. 879 million as against Rs. 966 million in the previous year. This is on account of restructuring of higher interest bearing debt and efficient management of surplus funds. 7.Profit After Tax After providing for current and deferred tax of Rs. 315 million (as against Rs. 448 million in the previous year), Profit after tax is higher at Rs. 2,217 million as compared to Rs. 1,865 million in the previous year, an increase by 19%, primarily on account of higher productivity, increased operational efficiencies and low interest cost. 8.Cement Plant in Maharashtra This was the first full year of our 2 million cement plant at Chandrapur, Maharashtra. The plant stabilised in 3 months time and is today running at over 100% capacity. The plant also has a captive thermal power plant which has helped to reduce the cost of production considerably. 9.Total Production and Sale of the group The total production of Ambuja group was 12.77 million tonnes on a capacity of 13 million tonnes. Similarly, the sale of the cement and clinker of Ambuja group was 12.78 million tonnes as against 10.08 million tonnes in the previous year. 10.Outlook for the current year Despatches of cement during the first
quarter of the fiscal year 2003-2004 have been lower at over 4% due to
transport strike in April 2003. Cement demand continues to be good and
in the month of May-June it has grown at an average of 9%. |
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