Sagar Cements (502090) Q2 24/25 earnings summary

Executive summary

• Q2 FY25 saw a 19% year-over-year revenue decline, with sales volume down 12% and plants operating at 43% utilization, driven by extended monsoons, sluggish project execution, and competitive pricing.

• EBITDA margin compressed to 4% in Q2 FY25 from 10–13% in Q2 FY24, with EBITDA per ton at INR 172.

• Loss after tax widened to INR 57 crore (₹5,698 lakhs) in Q2 FY25 from INR 11 crore (₹1,085 lakhs) in Q2 FY24.

• Management remains optimistic about medium to long-term prospects, citing robust housing, infrastructure initiatives, and focus on green energy.

• Un-audited standalone and consolidated financial results for Q2 and H1 FY25 were approved by the Board on October 23, 2024, with an unmodified review conclusion from statutory auditors.

Financial highlights

• Q2 FY25 consolidated revenue was INR 475 crore (₹47,512 lakhs), down 19% YoY; H1 FY25 revenue was INR 1,036 crore (₹1,03,572 lakhs), down 8% YoY.

• Q2 FY25 EBITDA was INR 20 crore (₹1,993 lakhs), margin declined to 4% from 10–13% YoY; standalone EBITDA margin fell to 1% from 8–9%.

• Q2 FY25 loss after tax was INR 57 crore (₹5,698 lakhs); H1 FY25 loss after tax was INR 89 crore (₹8,918 lakhs).

• Power and fuel cost per ton decreased to INR 1,446 from INR 1,626 YoY; freight cost per ton was INR 830, slightly down from INR 848.

• Standalone and consolidated net losses and margins deteriorated year-over-year.

Outlook and guidance

• FY25 volume guidance is 5.75 million tons, with expectations of demand improvement post-Diwali and into Q4.

• FY26 volume target is 6.5–6.75 million tons, assuming supportive weather and project execution.

• Management expects margin and profitability improvements through cost reductions, green energy, and plant upgrades.

• Q3 volume expected at 1.75–1.8 million tons; Q4 to see further improvement.

• The company continues to focus on cement and cement-related products as its core business segment.