Conference Call with SRF Limited Management and Analysts on Q4FY20 and Full Year Earnings Performance and Outlook. Listen to the full earnings transcript.
Call Participants: Mr. Rahul Jain - President & CFO, Ms Nitika Dhawan - Head of Corporate Communications
Introductory Remarks from Rahul Jain
Good afternoon everyone! I would like to extend a warm welcome to everyone joining us today on SRF’s full year FY20 and Q4 earnings call. I hope you, your team and loved ones are safe and doing well. I will begin the call with briefly addressing the impact of Covid-19 outbreak on our businesses and I will briefly take you through the key operational highlights of Q4 and the full year under review following which we will open the forum to have a detailed Q&A session.
The global economy and diverse industries across India markets have been witnessing an unprecedented health and economic crisis due to the outbreak of Covid-19 pandemic. In this environment, our primary focus was on ensuring business continuity considering all relevant guidelines as well as taking appropriate actions for the safety and wellbeing of our employees. In line with government directives, we have taken necessary steps to shutdown our facilities and subsequently also begun operations at various sites post requisite approval from state and authorities. Various measures have been put in place to ensure social distancing and safety of our employees which is paramount. Further, to ensure business continuity, appropriate measures have been implemented to ensure smooth operations at all locations.
I am pleased to say that we have registered a healthy performance for the quarter under review despite the dynamic and domestic global macro economic challenges.
In Q4FY20, the consolidated revenue stood at Rs 1,858 crore with EBITDA at Rs 395 crores
SRF reported 8% jump in Profit After Tax at Rs 194 crore for the March quarter as compared to corresponding period, last year
The company PAT grew from Rs 592 crore to Rs 916 crore in FY20, an increase of 55%
SRF’s EBITDA in FY20 increased 12% from Rs 1,349 crore to Rs 1,507 crore. The numbers stated above are excluding the discontinued operations that arose during the year from the sale of our engineering plastics business and closure of operations and technical textiles business at Thailand.
Including the impact of these, for the year FY20 we registered a PAT of Rs 1,019 crores as compared to Rs 641 crores in FY19, an increase of 59%
Going on to our segmental performance, our Chemicals business which comprises Fluorochemicals Business, specialty business. Tthe specialty segment business has been the focus and key growth driver for SRF. The business delivered robust performance on a strong demand from the export market substantiated by the team’s effort to an optimal utilisation of our capacity.
While we did not face any demand related issue from the pandemic, we did face some logistics issues which led to delays in certain shipments the relevant quarter
As a result of Covid-19, the production facilities were completely closed for 15 days and from mid-April 2020, a calibrated startup has been effective
As discussed from the previous call, a healthy demand from agro and pharma segments has been encouraging with the right investment and with the right investments that the company has made in these business, we are ready to see all opportunities that arise in the future
The expansion of capacities which we announced in the past for new products are on track
You would remember that we had given an outlook for 40-50% revenue growth in the specialty chemicals business at the beginning of last year. I am happy to share that our overall revenues for our business are in excess of Rs 1,650 crore which is higher than what we initially indicated
Even the management’s confidence in the business and its long term growth outlook indicated at the beginning of the fiscal year not only met the expectations but exceeded our all performance expectations. Further the business has also shown significant improvement in the margin as the operating leverage has laid out
We continue to be optimistic that the new product opportunity will emerge in both agro and pharma segment and exhibit a positive trajectory for the business in the future