Conference Call with Paradeep Phosphates Management and Analysts on Q4FY23 Performance and Outlook. Listen to the full earnings transcript.
Fertilizers company Paradeep Phosphates announced Q4FY23 & FY23 results: The company reported Q4 Income at Rs 3,714 crore, up by 93% compared to Q4 of last year. The EBIDTA for the quarter is at Rs 160 crore, up by 36 % compared to that in Q4 of last year The full year of FY23, the total income reported is at Rs 13,432 crore, up by 70% as compared to that of last year The EBIDTA for the full year stands at Rs 892 crore, up by 26% compared to that of last year. The Board of Directors has recommended a dividend of 5% ie Rs 0.50 per equity share of Rs 10 each fully paid up. Commenting on the results, Mr. S Krishnan, Managing Director, Paradeep Phosphates said, “During the fourth quarter of FY 22-23, we have been able to operate both the sites consistently with the help of our strong supply-side partnerships. We are happy to report that the integration of Goa plant is well complete and the site has been producing optimally. The Goa site produced 2,49,000 tons of finished fertilizers in Q4 including 1,21,691 tons of urea and several varied grades of NPKs. In Q4 of FY 23, our Paradeep site has produced a record 3,71,441 tons of finished fertilizers, up by 34% compared to that in Q4 of FY 22. During the year, we have strengthened our total capacity by 150% to reach a run-rate of 3 Million Tons Per Annum (MMTPA) of finished fertilizers effective December 2022. While our Paradeep site reached a capacity of 1.8 MMTPA organically from 1.2 MMTPA, our acquisition of Goa Plant added 1.2 MMTPA from June 2022. We are close to completing the remainder of the ongoing CAPEX projects namely the phosphoric acid capacity enhancement and the fourth evaporator by Q1 of FY 24. These projects will further aid our backward integration capability leading to higher profitability. Throughout the year we have successfully produced a wide variety of complex fertilizer grades (viz. NPK 10, NPK 12, NPK 14, NPK 19, NPK 20, NPK 24, NPK 28 and DAP) across both of our sites. Our wide-ranging products have served our farmers with nutrients specific to their soil and crop needs. During the year, we also embarked upon our sustainability journey by publishing our maiden ESG report mapped to global frameworks like GRI, SASB. We would continue to have sustainability as a central theme in our growth agenda. Going forward, we would continue to focus on growth by utilizing our strengthend capacity of 3 MMTPA along with our backward integration capability to produce a wide array of soil-centric fertilizers across both our sites and ensure we are able to make the nutrients available to the farming community in the 15+ states we operate across India. At a macro-economic level, the outlook remains positive with raw material prices correcting, global supply chain further improving and China re-opening.” Result PDF
Fertilizer firm Paradeep Phosphates announced Q2FY23 results: Revenue from operations at Rs 2,864 crore; up by 48% as compared to Rs 1,935 crore in Q2FY22 EBITDA at Rs 188 crore in Q2FY23. The adjusted EBITDA for the one-time Goa Plant acquisition cost is Rs 230 crore Total fertilisers produced at 506,195 MT compared with 368,340 MT in Q2FY22 Record production of 216,937 MT of N-20 in Q2FY23, compared to 151,870 MT in Q2FY22 Three new NPK grades—NPK 14:28:0, NPK 14:28:0:13 and NPK 24:24:0:0—launched. Improves farmer choice in their quest for soil-specific and crop-specific applications Goa fertilizer plant, which was acquired on June 1, 2022, produced 2,09,115 tonnes of finished fertilizers in Q2FY23, which includes 1,24,375 tonnes of Urea Raw material costs have increased in this quarter owing to steep global commodity prices. Certain raw material prices, however, have softened in October Finance costs have increased due to the increase in subsidies outstanding and currency volatility compared to the previous year Fertilizer demand is expected to remain firm for the commencing Rabi season, given the low stocks and high reservoir levels S Krishnan, Managing Director, Paradeep Phosphates said: “During the second quarter, we have been able to start the Goa Plant operations and all the 3 trains there are fully operational now. Also the completion of the revamp process of the 4th granulation train at the Paradeep Plant is in advanced stages. Regarding the product mix, our choice to manufacture a higher amount of N-20 and lower DAP this quarter reflects the flexibility of our production trains to adapt as per market demand. However, certain one time expenses and a delay in commissioning the NPK trains at the Goa Plant resulted in higher fixed costs and a consequential impact on EBITDA. Going forward, we believe robust demand experienced in Kharif will continue into Rabi and the industry will benefit from low inventory levels, high reservoir levels and an overall decline in some raw material prices.” Result PDF
Paradeep Phosphates announced Q1FY23 results: Revenue from operations at Rs 2435 crores, up by 85%, as compared to Rs 1316 crores of Q1 FY 21-22. EBITDA at Rs 167 crores, up by 56%, as compared to Rs 107 crores of Q1 FY 21-22. Total fertilizers produced at 283,624 MT vis a vis 227,785 MT in Q1 FY 21-22. New NPK grade NPK 14:28:0 launched. Improves farmer choice in their quest for a soil-specific and crop-specific applications. Acquisition of the Goa fertilizer plant completed as on June 1st 2022. Has added 1.2 million MTPA to the company’s total capacity. As of June 30th 2022, the company’s annualized capacity stands at 2.85 million MT per annum. Finance cost have increased due to increase in subsidy outstanding and currency volatility vis-à-vis previous year. Fertilizer demand expected to remain firm for ongoing Kharif and the Rabi seasons, given the low stocks and healthy rainfall projections. Commenting on the results, Mr. S Krishnan, Managing Director, Paradeep Phosphates said, “During the first quarter, we have added significant capacities through organic as well as inorganic route. This includes completion of revamp of three out of our four granulation trains at Paradeep site and also completion of the acquisition of the Goa plant which has in turn added 1.2 million MT to our overall capacity. With this, PPL now has an annualised capacity of 2.85 MMTPA as of 30th June’22. This quarter also marks the launch of a new product from our portfolio – the NPK 14:28:0 – a product that is a balanced combination of “N” and “P” ingredients and helps to further deepen our farmer linkages. While the Paradeep unit continues to perform well taking advantage of the deep supply chain linkages and long term procurement contracts, our current quarter performance has been impacted due to the various acquisition related costs such as stamp duty charges and the start-up costs of the urea-ammonia operations – all of which have been expensed off as per accounting standards. We believe robust demand will continue for sector on account of low inventory, good monsoon and high level of reservoir.” Result PDF