Below is the View On FIRST CUT 4QFY18 Results for Mangalam Cement by Binod Kumar Modi Sr. Research Analyst Reliance Securities
Subdued performance was largely on account of cost pressures and inability to pass on. However, gross debt reduction of ~Rs230mn was the only silver lining, though it’s lower than earlier guidance. Going forward, we believe MCL’s performance to improve with the likely pickup in utilisation and realisation recovery. We will come out with a detailed note post the concall scheduled tomorrow at 4:00 PM.
Costs Pressure Marred Performance:
* Mangalam Cement (MCL) has reported a poor performance as elevated cost pressures marred the performance.
* Reported EBITDA witnessed a steep decline of 53% YoY (+43% QoQ) to merely Rs117mn. EBITDA/tonne barely stood at Rs153 as against Rs357 and Rs110 in 4QFY17 and 3QFY18, respectively.
* Operational cost/tonne witnessed a sharp jump of 16% YoY and 0.5% QoQ to Rs3,850 mainly led by sharp increase in power & fuel cost/tonne (+64% YoY and +12% QoQ) and logistics & sales distribution cost/tonne (+23% YoY and +8% QoQ).
* Avg. realisation stood at Rs4,003/tonne (+9% YoY and +1.3% QoQ), while sales volume came in at 0.76mnT (+10% YoY and +3% QoQ).
* While interest cost declined by 30% YoY and 9% QoQ, lower other income and dismal operational performance resulted in PBT loss of Rs44mn. Profit for FY18 stood at Rs114mn v/s Rs366 in FY17.
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