Binani Cement Registers 54% Growth In Net Sales
Highlights Q3 FY09:
- Net Sales increased by 54% to Rs. 360.03 Crores as compared to Rs.233.31 crores in Q3 FY 08
- EBITDA dropped down to Rs. 47.34 Crores; drop of 52%
- During the current period, the profitability of the Company has been affected primarily due to doubling of the cost of imported coal- a major cost component
- In the recent past, there has been a substantial reduction in the international prices of coal, which will have favourable impact on financial performance in the last quarter of 2008-09
- PBT of Q3 FY 09 stood at Rs. 9.70 Crores as compared to Rs.61.01 Crores in Q3 FY 08
Mumbai, January 30, 2009 : Binani Cement Limited, a Rs 1500 crores cement major & the flagship subsidiary of Rs. 2500 crores Braj Binani Group announced its results for the third quarter ended 31 December 2008
9Months FY 2009 Vs. 9Months FY 2008 :
- Net Sales up by 54% for the 9 months FY09 at Rs. 992.36 Crores as compared to Rs 642.67 Crores for the corresponding period FY08
- EBITDA dropped down by 13% to Rs.210 Crores from Rs. 242 Crores
- PBT stood at Rs. 100.24 Crores in 9 months FY 09 as compared to Rs. 172.37 Crores for the corresponding period FY08
Note on Quarterly Result:
- Other expenses include foreign exchange fluctuation loss of Rs.235.14 Lacs in the current quarter (previous quarter’s gain Rs.46.58) and a loss of Rs.1173.46 Lacs in the current nine months period (previous period gain Rs.262.92). However, as per Company’s policy, 50% of the foreign exchange exposure is hedged to avoid speculative gain or loss
- The company has executed a long term contract for supply of coal from Indonesia to meet its requirement for captive power plants
- Company proposes to install an additional 25MW captive power plant to facilitate further reduction in cost of power generation
- The company has initiated activities for development of 10 Million Tonne reserves lignite mine at Nimbari Chandawatan, Rajasthan
- 1.50 million Split Grinding Unit at Neem Ka Thana has been stabilized with 50% capacity utilization. Installation of railway siding and Board Gauge connectivity through Bhagega, will reduce cost of transportation
- Increase in capacity which is planned in phases will further improve economies of operations With increased production, the company has been able to penetrate the Maharashtra market and proposes to enter eastern India using rail transportation.
- With increase thrust on OPC, the company expects to achieve production of 4.50 Million MT in FY 2008-09 and 5.50 Million MT in FY 2009-10
- To increase OPC production, the company has decided to install additional cement grinding and packing plant at Binanigram which is expected to be operational by the end of 2009
Commenting on the Company’s performance and growth strategies, Mr. Vinod Juneja, Managing Director, Binani Cement Limited said, “Profitability has been affected mainly due to substantial increase in the cost of imported coal, which could not be passed on to the customers. The adverse impact of increase in cost for clinker productions is Rs. 60 Crores (approx.) in Q3FY09 and Rs. 125 Crores (approx.) in 9 months FY09.
With sharp decline in the coal prices in last quarter and for the period January to March 2009, this will see a considerable saving in input cost. With global coal price softening coupled with the benefit of lower coal price in recently concluded deliveries which cover the companies requirement up to mid April 2009.
On account of weakening rupee there was a Forex fluctuation loss on coal import liabilities. However, as per the company’s policy, 50% of the foreign exchange exposure is hedged to avoid speculating gains or losses. The company has also executed a long term contract for supply of coal from Indonesia for its coal requirements for its Captive Power Plants,” Said Mr. Juneja.