Birla Corporation Limited on Friday reported a June quarter EBITDA of Rs 252 crore; which represents a drop of 37% from last year amid severe disruptions in key markets and manufacturing centers due to the Covid-19 pandemic.
The operations of the Company’s plants stood suspended for nearly the entire month of April. Sales during this period were also negligible. Though things started to move in May, it was only in the latter half of the month that operations normalized. With production across most plants gaining steam only in the first week of May; around seven of 13 weeks were available during the quarter. However, local lockdowns and restrictions continued to hobble operations.
Although it took longer than expected to restart operations; all teams mobilized for the rapid ramp-up to deliver a high run-rate in the latter part of May and June. This partially compensated for the loss of volumes and earnings in the six weeks of the quarter; although sporadic disruptions in isolated pockets in core markets continued.
Cash profit and net profit for the quarter at Rs 172 crore and Rs 66 crore; respectively, are the result of a turnaround in end May and June, though significantly lower than last year on account of the impact of the lockdown from the end of March.
Revenue for the June quarter (including other income) at Rs 1,241 crore declined 34.7% year-on-year as sales by volume dropped 33.9% to 2.4 million tons (mt).
| June 2020 | June 2019 | Change | |
| Revenue (incl. other income) | Rs 1,241 crore | Rs 1,901 crore | -35% |
| EBITDA | Rs 252 crore | Rs 402 crore | -37% |
| Cash profit | Rs 172 crore | Rs 305 crore | -44% |
| Net profit | Rs 66 crore | Rs 141 crore | -53% |
| Realization per ton* | Rs 4,906 | Rs 4,929 | -0.5% |
| EBITDA per ton* | Rs 981 | Rs 1,034 | -5% |
*for cement division only
While April was a washout for most cement companies due to commercial activities coming to a standstill, markets began to open-up in May on the back of multiple factors such as pent up demand from the trade channels (which had run dry during the lockdown), pick up in rural housing, a good Rabi harvest and better availability of construction workers in the villages.
Construction in urban areas continued to be affected adversely due to acute shortage of workforce and spread of the pandemic leading to extended lockdowns in most cities. It is only towards end of June, some green shoots were visible thanks to demand from government-led infrastructure projects and release of funds for welfare schemes such as MGNREGA and PMGKY.