Himadri Speciality Chemical (500184) Q4 19/20 earnings summary

Executive summary

• FY20 revenue and profitability fell amid weaker demand, lower realizations, inventory write-downs and COVID-19 disruption; sales volumes were maintained broadly in line with prior years.

• Strategic focus remained on value-added carbon products, with Speciality Carbon Black commercialized; long-term outlook remained optimistic, while cash conservation and risk mitigation shaped near-term plans.

Financial highlights

• Consolidated FY20 revenue from operations fell 25.45% to ₹1,805.80 crore; EBITDA, excluding FX and other income, fell 47.65% to ₹294.46 crore; PAT was ₹205.36 crore.

• Standalone revenue from operations declined 24.11% to ₹1,803.50 crore; EBITDA, excluding FX and other income, fell 44.63% to ₹298.07 crore; PAT dropped to ₹80.98 crore from ₹311.39 crore.

• Standalone profit before exceptional items was ₹197.75 crore; exceptional loss of ₹127.99 crore reduced PBT to ₹69.76 crore.

• Consolidated FY20 EPS was ₹4.91 vs ₹7.75; standalone EPS was ₹1.93 vs ₹7.44.

• Adjusted for inventory write-down/losses and receivables/advances charges, normalized EBITDA was reported at ₹342 crore; reported EBITDA was affected by ₹44 crore pre-tax charges.

Outlook and guidance

• Gradual economic recovery was expected in H2 FY21 as lockdowns eased; stimulus, reforms, infrastructure investment, exports and support for autos were viewed as recovery drivers.

• Speciality Carbon Black commercialisation and higher value-added products were expected to support operating profit; R&D and new grades remained priorities.

• Part of the Advance Carbon Material expansion was temporarily put on hold to conserve cash pending greater clarity on pandemic-related economic effects.