UPL’s Q4 net drops 43% to ₹792 crore on pricing pressure, delayed planting season

Majoring in agricultural chemicals UPL It reported a 43 per cent drop in net profit for the March quarter 2023 at ₹792 crore over the same period last year at ₹1,379 crore, affected by lower producer prices and delays in the growing season. Revenue for the quarter increased by 4 per cent to Rs.16,569 crore (Rs.15,860 crore).

EBITDA for the quarter decreased by 16 per cent at Rs.3,033 crore compared to the previous quarter from Rs.3,591 crore. EBITDA margin decreased by 18.3% compared to 22.6% in the corresponding quarter.

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For FY23, UPL reported a 2 per cent decline in net profit at Rs.3,569 crore (Rs.3,626 crore). Revenue for the year increased by 16 per cent to Rs. 53,576 crore (Rs. 46,240 crore). “Fiscal year 2023 was a tale of two distinct periods, our performance in the first nine months delivered 20% growth in revenue and EBITDA. The fourth quarter was extraordinary,” Mike Frank, CEO of UPL Global Crop Protection, said in a statement. With pricing pressure and delays in channel purchases in the post-patent space due to an oversupply of certain molecules.

Our focus last quarter was to increase our share of key markets, liquidate most of our high-cost inventory, manage working capital closely, and intelligently prepare our inventory position for the year ahead. As a result, given our weak inventory position, we are well positioned to handle the challenging market conditions that are likely to continue through the first half of fiscal ’24, but also to take advantage once the market begins to normalize thereafter. Backed by our superior manufacturing capabilities and product innovation, Frank said, we remain confident to grow faster than the market in fiscal ’24 and beyond.

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EBITDA margin

EBITDA margins for fiscal ’23 were down 20.9% from a year-over-year 22%, primarily due to weaker-than-expected performance in the fourth quarter that was impacted by headwinds in the post-patent space, which offset performance Health that was introduced during the first nine. Months “We delivered a resilient set of results for FY23 despite experiencing significant headwinds in the last quarter. We reduced our gross debt by over $600 million and net debt by $440 million driven by improved cash flow from operations and turnover Leaner factor.Going forward, as we look into fiscal year ’24, we are well positioned to weather market headwinds and deliver better profitability growth.Longer term, we remain confident in delivering on our ambitions for growth and transformation,” Jay Shroff, CEO of UPL, said in a statement. Food value chain with focus on sustainability.

UPL ended up 0.49 percent at INR 718.35 on Monday.