OREANDA-NEWS. February 13, 2012. EPS (diluted and non-annualised) at Rs27.4 per share

9M FY2012 consolidated financial highlights

Net sales higher by 23 per cent to Rs10,335 crore.

Profit from operations rises to Rs1,757 crore; EBIDTA margins at 17 per cent.

TCL has not recognised subsidy income of Rs45 crore on opening stock of raw materials for phosphatic and potassic fertilisers, in accordance with the office memorandum issued by the Department of Fertilisers (DoF) dated July 11, 2011. The matter is being contested.

PBT at Rs1,121 crore vis-a-vis Rs859 crore.

PAT (after minority interest) at Rs699 crore against Rs508 crore. It includes following non-operational items:

Profit of Rs51 crore from sale of investments.

Unrealised loss of Rs60 crore on revaluation of un-hedged ECB in accordance with notification issued MCA.

Impairment of assets Rs23 crore (biofuels and Rallis (Turbhe facility)).

VRS at Rallis (Turbhe facility) and Mithapur of Rs20 crore.

Provision for impairment of investment in Khet-Se Rs12 crore; post suspension of operations.

Impact of Rs33 crore in accordance with the above circular issued by DoF.

EPS (diluted and non-annualised) at Rs27.44.

Q3 FY12 business highlights and developments

Growth across all locations — domestic and international.

Demand environment across major products stable.

Rising input costs exerting pressure on margins, partially mitigated by higher realisations and efficient operations.

However, early signs of contraction of soda ash demand beginning to appear.

Expansion of soda ash capacity by 100,000TPA at TCNA concluded.

Improved operational efficiencies at customised fertiliser plant.

Rupee depreciation and higher farm gate prices restraining off-take.

Debottlenecking of SSP capacity by 50,000TPA at Haldia complete. Post commencement stabilisation underway.

Commenting on the company’s Q3 FY2011-12 performance, R Mukundan, managing director, said:

“We are delighted to report continuing strong operating and financial performance. All our facilities both, domestic and international have performed well. Our production and sales volumes have been stable. While input prices have been rising, our operational efficiencies have enabled us to increase prices to a lesser degree, thus keeping our end consumer relatively protected.

During the quarter under review, we completed the 100,000 tonne expansion of our natural soda ash facility in North America as well as the debottlenecking of our SSP capacity at Haldia by 50,000MT. Both these operations are expected to achieve stability in the current quarter. We have also significantly expanded our distribution presence for i-Shakti pulses and are now present in 18 states across the country.

Firm input prices continue to present a challenge but the strengthening of the Indian rupee over the last month has been encouraging. While the current demand environment appears stable, it continues to be influenced by several macro environment factors. I am however confident that our access to low-cost resources combined with efficient operations and well-entrenched and expansive distribution network will enable us to continue to create value and drive growth.”

BUSINESS PERFORMANCE

Chemicals

Prices hiked across locations — helped mitigate impact of rising input cost.

Domestic demand for soda ash stable.

Operational performance maintained at Mithapur facility.

Higher variable cost of production given rising input costs (imported coal and limestone) continue — usage efficiency and price hike partially offset the impact.

Tata Chemicals Europe operations witnessing improving utilisation.

Delayed onset of winter with mild conditions in January may impact salt sales.

British Salt performance robust — production, sales and realisations continue to be healthy.

Steady improvement in Magadi operations. Volumes lower largely due to power outage and lack of rakes.

Magadi Return to Excellence (MRTE) programme initiatives likely to bring down consumption in next few quarters.

Production at Tata Chemicals North America moderated due to slow resumption of operations post expansion.

However, improved realisations partially mitigated the impact.

Consumer products

Strong demand continues for branded salt pan India — volumes growth at approximately 9 per cent.

National branded segment as a percent of total salt segment grows strongly — stands at 24 per cent in 2010-11.

Maintained leadership position with a 64 per cent market share in the national branded segment.

i-Shakti pulses available across 18 states.    

Strong sales promotion activities enable robust off-take for i-Shakti range of pulses.

Fertilisers

Operations at Babrala stable; new ammonia convertor to be hooked up in March / April 2012.

Improvement in profitability of customised fertiliser on account of steady rise in volumes and firm pricing.

Specialty fertiliser register healthy volume growth — plans to aggressively grow this business.

Firm prices of phosphoric acid combined with higher sales volumes at IMACID improve performance.