Dalmia Bharat (DALBHARAT) Q4 13/14 earnings summary

Executive summary

• Cement sales rose 11% YoY to 6.7 MnT; consolidated net revenue increased 6% to ₹2,955 crore, but weaker realisations drove EBITDA down and the year ended with a consolidated net loss.

• Expansion across East, North East and Karnataka lifted installed capacity above 20 MnT, with further projects planned for commissioning in FY2015.

Financial highlights

• Consolidated gross operating income was ₹3,364 crore, up 6% YoY; net operating income was ₹2,955 crore, up 6%.

• Consolidated EBITDA was ₹534.38 crore versus ₹711.12 crore; loss after tax was ₹8.42 crore versus profit of ₹197.11 crore; EPS was -₹1.04 versus ₹24.28.

• Operating expenditure rose 18% to ₹2,541 crore; freight increased to ₹531 crore from ₹412 crore, partly due to prevention of overloading in South.

• Other income rose to ₹120.52 crore from ₹76.94 crore, including ₹40.03 crore net profit on investment sales; financial charges increased to ₹315.14 crore from ₹231.43 crore.

Outlook and guidance

• FY2015 was expected to improve with infrastructure and construction demand; planned priorities included commissioning the Assam clinker unit and Belgaum greenfield project.

• Belgaum’s 2.5 MnT project and Calcom’s ~1 MnT Assam brownfield expansion were expected to commission in FY2015; captive power capacity in the South was expected to increase from 72 MW to 97 MW.

• Further cost reductions at existing and acquired units, nearby-market sales growth, logistics optimisation and higher realisations were targeted to support margins.