Earnings Review
UPL records highest consol net profit in 7 quarters
This story was originally published at 17:19 IST on 31 January 2025
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--UPL Oct-Dec consol net profit INR 8.28 bln
--Analysts saw UPL Oct-Dec consol net profit INR 1.85 bln
--UPL Oct-Dec consol net profit INR 8.28 bln vs INR 12.17 bln loss
--UPL Oct-Dec consol revenue INR 109.07 bln vs INR 98.87 bln year ago
--UPL Apr-Dec consol net profit INR 10 mln vs INR 12.40 bln loss
--UPL Apr-Dec consol revenue INR 310.64 bln vs INR 290.20 bln year ago
--UPL Oct-Dec crop protection revenue INR 94.34 bln vs INR 84.94 bln yr ago
--UPL Oct-Dec seeds business revenue INR 10.09 bln vs INR 9.31 bln year ago
--UPL Oct-Dec consol EBITDA INR 21.63 bln vs INR 4.16 bln year ago
--UPL Oct-Dec consol EBITDA margin 19.8% vs 4.2% year ago
--UPL Oct-Dec Latin America revenue INR 48.15 bln vs INR 42.87 bln year ago
--UPL Oct-Dec Europe revenue INR 12.85 bln vs INR 10.06 bln year ago
--UPL Oct-Dec India revenue INR 11.05 bln vs INR 8.60 bln year ago
--UPL Oct-Dec North America revenue INR 15.71 bln vs INR 9.90 bln year ago
--UPL: Seeing bounce back with recovery in volumes, prices vs last year
--UPL: Expect improvement in margin to continue in Jan-Mar
By J. Navya Sruthi
MUMBAI – Recovery of volumes and prices during the December quarter helped agrochemical company UPL Ltd. to report its highest consolidated net profit in seven quarters. Apart from the growth in volumes and prices, lower expenses driven by a fall in raw material costs also boosted the consolidated net profit of the company.
The company posted a consolidated net profit of INR 8.28 billion during the December quarter, higher than INR 1.85 billion profit estimated by analysts. It reported a net loss of INR 12.17 billion during the same quarter last year.
The company's consolidated revenue rose 10.3% on year to INR 109.07 billion in Oct-Dec. Analysts had expected a consolidated revenue of INR 110.77 billion. The company reported the highest on-year growth in consolidated revenue in eight quarters. Other income for the quarter rose to INR 1.7 billion, up 12.6% on year.
In Apr-Dec, the company reported a consolidated net profit of INR 10 million against a loss of INR 12.40 billion in the year-ago period. The company's consolidated revenue for the first nine months of the current financial year was INR 310.64 billion, up 7% on year.
The company's consolidated earnings before interest, tax, depreciation, and amortisation for the December quarter surged to INR 21.63 billion, from INR 4.16 billion in the year-ago period. For the December quarter, the company reported an EBITDA margin of 19.8%, up 15.6 percentage points from the year-ago quarter. Favourable product mix, better prices, and an improvement in the production cost aided the sharp improvement in the company's margins during the quarter.
The agrochemical company recorded a near 16% fall in the cost of materials consumed on a year-on-year basis during the latest quarter. The cost of materials consumed for the quarter was INR 53 billion in the December quarter. The company's finance cost for the December quarter fell nearly 39% to INR 7.3 billion from the year-ago quarter. Consequently, the company's total expenses fell 11% on year to INR 103.69 billion.
UPL's net debt as of Dec. 31 was lower by $745 million compared with a year ago. "Through strong focus, the team has done a commendable job in bringing down the working capital, resulting in a significant reduction of our net debt versus September, 2024," said Jai Shroff, the chairman and group's chief executive officer, in the company's press release. "With this strong performance, we are confident of delivering our EBITDA and free cash flow guidance for the full year." The company had earlier guided for a 50% growth in EBITDA for the current financial year.
Revenue from the company's crop protection business rose to INR 94.34 billion during the December quarter from INR 84.94 billion a year ago. Revenue from the seeds business rose to INR 10.09 billion from INR 9.31 billion in the same quarter last year. The overall robust performance in the seed business was driven by sorghum, sunflower, and corn, the release said.
The company reported the highest revenue growth in North America compared with that of other regions. The company's revenue from North America rose 59% on year to INR 15.71 billion in the December quarter. The company's India and Europe revenues grew 28% on year each to INR 11.05 billion and INR 12.85 billion, respectively. UPL's Latin America revenue, which accounted for 44% of the total revenue, grew 12% on year to INR 48.15 billion.
On Friday, UPL Ltd's shares closed 6.5% higher at a 15-month high of INR 603.75 on the National Stock Exchange, after the company released its earnings. During the day the stock surged 9% to an intraday high of INR 617.80. End
US$1 = INR 86.60
Edited by Akul Nishant Akhoury
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