Vardhman Special Steels Q4 revenue falls 15 pc to Rs 206 crore

Vardhman Special Steels has reported revenue from operations at Rs 206 crore in Q4 FY20 as against Rs 243 crore in Q4 FY19, marking a decline of 15.45 per cent due to fall in prices of finished goods combined with a slowdown in the automotive sector.

Volumes for the quarter, however, stood at 35,715 tonnes -- up 3.9 per cent year-on-year.

Earnings before interest, taxes, depreciation and amortisation (EBITDA) including other income for the quarter totalled Rs 17 crore as against Rs 11 crore in the corresponding previous period, up 54.5 per cent mainly on account lower cost of stores and spares consumed as compared to last year.

In Q4 FY19, the costs were higher on account of higher production to build inventory for the planned shutdown and also on account of reduction in graphite electrode prices, the company said in a statement.

Profit after tax in Q4 FY20 stood at Rs 3.57 crore as against a loss of Rs 15 lakh in Q4 FY19 due to a reduction in the price of graphite electrodes and a decline in interest costs.

During the first half of FY20, the company had undertaken a shutdown of nearly 78 days of the steel melting shop to upgrade and modernise the facilities.

Vice-Chairman and Managing Director Sachit Jain said the company clocked a revenue of Rs 846 crore in FY20 with EBITDA and PAT of Rs 49 crore and Rs 3.3 crore. The full-year performance was impacted by the continued and significant slowdown in the automotive industry.

"This was mainly due to the auto industry witnessing a major change in terms of latest technology and adoption of BS-VI norms which impacted the entire value and supply chain. But these challenges also brought with it a lot of opportunities. We are rethinking on our business strategy, formulating plans on how to tackle such changes in the future."

Vardhman is one of India's leading producers of special steels catering to diverse requirements of automotive, engineering, tractors, bearing and allied industries. The company also caters to customers for forging applications in international markets of Thailand, Taiwan, Turkey, Italy, Russia, Germany, Vietnam and Japan.

( With inputs from ANI )