India`s Prism Johnson posts bigger-than-expected Q2 loss on tepid cement demand
Indian construction materials maker Prism Johnson on Wednesday posted a bigger-than-expected quarterly loss, as cement prices persistently declined and demand remained tepid.
The company's consolidated net loss stood at 897.9 million rupees ($10.6 million) in the three months ended Sept. 30, marking a second straight quarter of losses. Prism Johnson had reported a net profit of 1.83 billion rupees a year ago.
The reported loss is also bigger than the analysts' estimates of a 122.8 million rupee loss, as per data compiled by LSEG.
Average cement prices slumped to a 51-month low around July-end and the first half of August, and only rose marginally in the later part of the quarter, Elara Capital said in a note.
Prices for the overall quarter declined 7% year-on-year, the brokerage added.
Demand in the reported quarter was also largely muted as the industry, already hit by an election-linked slowdown in construction activity in the June quarter, did not see any improvement due to above-average rainfall in the country.
The company's net sales dropped 5.2% to 16.39 billion rupees, owing to a 17% decline in its cement business, which makes up 37% of the revenue.
Prism Johnson's other two businesses - tiles and concrete mix - posted a 1% and 0.4% drop in revenues in their respective segment.
The company's shares, which were in the red ahead of results, fell 2.5% post results.
India's top cement maker, UltraTech Cement, missed second-quarter profit estimates on lower prices and bleak demand.
($1 = 84.3900 Indian rupees)
