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Heidelberg Cement posted 2% decline in net profit to Rs 63.62 crore despite of 9% rise in income from operation to Rs 595.27 crore for the third quarter ended December 2020. Total sales volume inclined 3.7% to 1.27 million tonnes (mt).
Quarterly Performance
The Company income from operation rose 9% to Rs 595.27 crore for the third quarter ended December 2020, on gains in sales volume and sales prices. Total sales volume inclined 3.7% to 1.27 million tonnes (mt).
Operating margin (OPM) fell by 170 bps to 20.2%, as rise in power & fuel expense by 160 bps to 24.5% and other costs by 90 bps to 18.3% as a percentage to sales and net of stock adjustments were offset by fall in raw material costs by 50 bps to 17.7% and logistic expenses by 10 bps to 13.3%. As a result, the operating profit (OP) was flat at Rs 120.21 crore.
Other income added 3% to Rs 11.78 crore. With 35% fall in interest cost to Rs 12.38 crore but 4% rise in depreciation cost to Rs 27.83 crore, the Company booked 7% jump in PBT to Rs 91.78 crore. The tax outgo was up 33% to Rs 28.16 crore. The effective tax rate rose by 610 bps to 30.7%.Thus, Net Profit fell by 2% to Rs 63.62 crore.
Nine Months ended December performance
For Nine Months ended December 2020, Sales of the company declined 9% to Rs 1,516.72 crore. OPM fell by 80 bps to 23.4%. As a result, the operating profit (OP) fell 11% to Rs 354.49 crore. Other income declined 11% to Rs 31.69 crore. With 28% fall in interest cost to Rs 41.70 crore but 3% rise in depreciation cost to Rs 83.56 crore, the Company booked 12% fall in PBT to Rs 260.92 crore. The tax outgo was down 10% to Rs 85.96 crore. The effective tax rate fell by rose 80 bps to 32.9%.Thus, Net Profit dropped by 13% to Rs 174.96 crore.
Annual Financial Performance
For the financial year ended March 2020 (FY 2020), income from operation of the company advanced by 2% to Rs 2,169.62 crore. OPM inclined by 170 bps to 24.3%, thus, OP rose by 9% at Rs 527.79 crore. Other income grew by 51% to Rs 52.73 crore. After accounting for finance charges (down 1% to Rs 73.85 crore), depreciation (up 7% at Rs 108.61 crore), the PBT inclined by 17% to Rs 398.06 crore. The tax outgo was up by 7% to Rs 130 crore. The effective tax rate fell by 280 bps to 32.7%. Thus, the Net Profit grew by 21% to Rs 268.06 crore.
The scrip hovers around Rs 229.90 (09 February 2021) on the BSE.
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