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Shree Cement’s profit dips 16% as margin remains under pressure due to high input costs

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Shree Cement’s profit dips 16% as margin remains under pressure due to high input costs

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Shree Cement's profit at Rs 645 crore for the January to March 2022 period declined 16 percent year on year. It, however, beat Street estimates of Rs 611 crore.

Shree Cement’s profit dips 16% as margin remains under pressure due to high input costs
Shree Cement's revenue during the January to March 2022 period improved marginally as compared to the previous year, however, it failed to meet last fiscal levels on all other key parameters — profit, margin and EBITDA (earnings before interest, taxes, depreciation, and amortization).
The cement manufacturer that announced quarterly results on Saturday, however, reported a 5.6 percent higher profit at Rs 645 crore than what Street expected. A CNBC-TV18 poll of analysts had predicted the figure to stand at Rs 611 crore. But, it is 16 percent lower than the Rs 768 crore profit that the company registered in the fourth quarter of last year.
Shree Cement reported revenue growth of 3.6 percent at Rs 4,098 crore for the quarter under review against Rs 3,958 in the corresponding quarter of the previous fiscal. It missed analysts' expectations of Rs 4,180 crore by almost 2 percent.
As expected by Shree Cement’s Managing Director HM Bangur, the firm’s margin remained under pressure due to higher costs. The firm's margin for March 2022 the quarter under review stood at 22.22 percent as against 30 percent last year.
He had then said coal prices have risen due to the Russia-Ukraine war and energy costs have gone up by 70-80 percent owing to higher raw material costs.
“Even without war (Russia-Ukraine), the coal prices were rising at a steady rate, and with the war, it has risen sharply. So war has impacted and cost has gone up to Rs 40-50 a bag,” he told CNBC-TV18 earlier. The firm was looking to gradually increase cement rates to pass on higher input costs.
Meanwhile, the company’s board of directors has recommended a final dividend of Rs. 45 per equity share of Rs. 10 each for the year ended March 31, 2022 subject to the approval of the members at the ensuing annual general meeting of the company, the firm said in a regulatory filing.
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