UPL Ltd. reported a net loss in the fourth quarter of fiscal 2024, which was however lower than analysts' estimates.
The agro-chemical manufacturer posted a net loss of Rs 80 crore in the quarter-ended March, according to an exchange filing on Monday. This compares with a net loss of Rs 382.37 crore, as per consensus estimates of analysts tracked by Bloomberg.
UPL Q4 FY24 Results (Consolidated, YoY)
Revenue down 15% to Rs 14,078 crore versus Rs 16,569 crore (Bloomberg estimate: Rs 12,422.46 crore).
Ebitda down 32% to Rs 1,848 crore versus Rs 2,722 crore (Bloomberg estimate: Rs 1,284.31 crore).
Ebitda margin at 13.1% versus 16.4% (Bloomberg estimate: 10.30%).
Net loss of Rs 80 crore versus profit of Rs 1,080 crore (Bloomberg estimate: Rs 382.37 crore loss).
Key Highlights
Company reported margin recovery in Q4 FY24 as compared with Q3.
Q4 revenue declined by 15%, primarily due to lower prices in the post-patent market (prices came off against last year's higher base).
Volume were largely in line with last year.
Contribution margin are primarily impacted by the liquidation of high-cost inventory and higher rebates to support the channel. Adjusted for this transitory impact, Q4 FY24 contribution margin would be higher versus last year, and full-year FY24 contribution margin would be on par with last year.
Differentiated and sustainable portfolio continued to outperform. Share of this portfolio as a percentage of crop protection revenue rose ~700 bps YoY to 35% for full-year FY24.
Reduced SG&A expenses by 17% YoY to Rs 2,209 crore in Q4.
“We delivered significantly improved financial results in Q4 versus the two preceding quarters, in spite of the prevailing volatile and challenging market conditions," said Mike Frank, CEO at UPL Corp.
"As we look ahead to FY25, we expect a return to growth and normalisation in margin, driven by the ag-chem market returning to normality."
Further, the foremost priority remains to deleverage the balance sheet, which they plan to achieve through operational cash flows, completion of rights issue, and pursuing capital raise opportunities within platforms, he said.
FY25 Outlook
Company expects 4%-8% of revenue growth in FY25.
Expects Ebitda growth of more than 50%.
$300-$400 million operational free cash generation will be used for debt reduction.
Shares of UPL rose 3.59% to Rs 519.9 apiece, as compared with a gain of 0.30% in the benchmark Nifty 50.
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