Shree Renuka Sugars (RENUKA) Q4 14/15 earnings summary

Executive summary

• FY15 standalone revenue fell 13% to ₹57,481 million and EBITDA fell 7% to ₹1,802 million; net loss narrowed to ₹2,951 million from ₹4,661 million.

• Consolidated revenue was ₹100,876 million and net loss ₹18,129 million; Brazilian operations and foreign-exchange losses weighed heavily on results.

Financial highlights

• Standalone total income was ₹57,481 million versus ₹65,771 million; loss before tax was ₹4,458 million versus ₹6,208 million.

• Standalone exceptional foreign-exchange loss was ₹1,342 million, compared with ₹3,317 million in FY14; adjusted for this item, loss before exceptional items was ₹3,116 million.

• Consolidated EBITDA was ₹4,763 million versus ₹9,881 million; PBT loss was ₹20,886 million versus ₹16,790 million.

• Standalone operating cash flow improved to ₹2,614 million from an outflow of ₹5,650 million; consolidated operating cash flow was ₹7,342 million versus ₹2,239 million.

Outlook and guidance

• Near-term recovery prospects were described as weak amid high inventories, depressed sugar prices, cane-price rigidity and ongoing industry financial stress.

• Global 2015-16 sugar output was forecast to fall 0.5% to 173.4 million MT, while consumption was forecast to rise 1.6% to 173.4 million MT; high stocks could limit price gains.

• Indian ethanol policy changes, including a ₹48.50–49.50/litre supply price and excise-duty removal for eligible supplies, were expected to support cash flows and ethanol diversion.

• Brazil’s 27% mandatory ethanol blend and higher gasoline taxes were expected to encourage ethanol output and cane diversion from sugar.