Shree Cement (SHREECEM) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 was challenging due to weak demand from elections and extreme weather, but production processes and cost efficiencies were optimized, and branding initiatives continued.

• Board approved unaudited standalone and consolidated financial results for the quarter ended 30 June 2024, with statutory auditor review confirming compliance and no material misstatements.

• Total volume increased 8% year-over-year to 9.64 million tons, with capacity utilization at 76%.

• Realizations declined 6% year-over-year due to moderate demand and a shift in geographic mix, especially increased sales in the East.

• New integrated cement unit commissioned in Andhra Pradesh, with several expansion projects on track across India.

Financial highlights

• EBITDA decreased 2% year-over-year to INR 916 crore; EBITDA per ton fell to INR 950.

• Standalone revenue from operations was ₹4,834.69 crore, down from ₹5,072.68 crore in the previous quarter and ₹4,970.99 crore year-over-year.

• Standalone net profit for the quarter was ₹315.24 crore, a decrease from ₹655.03 crore in the previous quarter and ₹578.35 crore year-over-year.

• Consolidated revenue from operations was ₹5,123.96 crore, down from ₹5,401.02 crore in the previous quarter but up from ₹5,035.65 crore year-over-year.

• Consolidated net profit attributable to owners was ₹278.61 crore, down from ₹674.88 crore in the previous quarter and ₹572.30 crore year-over-year.

Outlook and guidance

• Management expects Q2 and Q3 to remain weak due to delayed government budget approvals and seasonal factors; demand and pricing are likely to stay subdued until Q4.

• Volume growth guidance revised to grow in tandem with the market for the rest of FY25.

• CapEx guidance maintained at INR 4,000 crore annually, with no plans for equity dilution or additional borrowing.

• No explicit forward-looking guidance provided, but management notes no need for adjustments to current or prior period financial statements despite ongoing tax matters.