Shree Cement (SHREECEM) Q4 16/17 earnings summary

Executive summary

• FY17 delivered cement production of 20.287 million tonnes, revenue from operations of ₹9,496.52 crore, EBITDA of ₹2,874.94 crore and net profit of ₹1,339.11 crore.

• Cement gains lifted operating performance, while power sales and earnings were pressured by higher fuel prices and challenging short-term market conditions.

Financial highlights

• Revenue from operations ₹9,496.52 crore; other income ₹507.71 crore; total revenue ₹10,004.23 crore; EBITDA ₹2,874.94 crore; PBT ₹1,530.81 crore; net profit ₹1,339.11 crore.

• Cement revenue rose 19.4% to ₹8,924.11 crore; cement EBITDA increased 37.3% to ₹2,210.73 crore, supported by volume growth, improved realization and cost controls.

• Power revenue was ₹572.41 crore and EBITDA ₹156.50 crore; both were lower than the prior nine-month period, with power sales at 1,658 million units versus 1,739 million units.

• Operating cash flow was ₹2,201.65 crore; investing cash outflow ₹2,047.90 crore and financing cash outflow ₹166.91 crore. Cash and cash equivalents ended at ₹23.21 crore.

Outlook and guidance

• FY18 cement-sector outlook was positive, with construction activity recovering after demonetization, government infrastructure spending, lower interest rates and affordable-housing incentives expected to support demand.

• The 2.6 MTPA clinker expansion at Baloda Bazar was expected to finish by March 2018; the 3.0 MTPA integrated Karnataka project was progressing to schedule for December 2018 completion.

• The 2017-18 macro outlook was described as bright, supported by expected normal monsoon, revived public and private investment, infrastructure programs and the anticipated GST regime.