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UPL sales up 10% in FY 2015-16qrcode

May. 4, 2016

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May. 4, 2016

UPL sales up 10% in FY 2015-16

UPL Limited has reported total income from operations rose by 19.7% (compared with the fourth quarter of FY 2014-15) to Rs 43,397 million ($ 651 million, at current rate) in the fourth quarter ended March 31, 2016. Volume growth and price increase contributed 25% and 1% to the sales growth, respectively, which offset by 6% negative exchange impact.
Overseas business revenues approximately accounted for 90% of the total income, which rose by 21.7% compared with the same period of last fiscal year, reaching Rs 39,230 million ($ 588 million). Domestic sales were Rs 4,170 million ($ 36 million).

Consolidated net profit of the company was reported a 25.4% increase to Rs 5,520 million ($ 83 million) in the fourth quarter. 
Sales of the company’s Agro Activities business, including agrochemical and seed products, were up by 22.5% to Rs 42,916 million ($ 644 million), accounting for 98.9% of total revenue. 
Full year result
For the fiscal year 2015-16, UPL achieved a 10% increase in consolidated income from operations, reaching Rs 133,015 million ($ 1,995 million).17% Volume growth and 1% price increase contributing to the sales growth was offset by 8% negative exchange impact. Sales of Agro Activities segment rose by 11% to Rs 129,447 million ($ 1,942 million).
Net profit of the company was improved by 13.5% to Rs 12,988 million ($ 195 million).
Overseas business revenues accounted for 79.6% of the total income of the full year, which rose by 11.8% compared with last fiscal year, reaching Rs 105,890 million ($ 1588 million). Domestic sales were Rs 27,130 million ($ 407 million).

Regional sales analysis

The company said that, in India, serious drought conditions continued in Kharif and Rabi, affecting agrochemical usage. High channel inventory continued, resulting in tight liquidity in the market. The positive sides in the domestic market are: farmers have good acceptance of UPL’s insecticides against serious infestation of sucking insects (White Fly) in North; and new herbicide product Shagun® had excellent performance on wheat.
In Latin America, UPL portfolio performed well in rice, fruits & vegetables in Mexico & Columbia. Farmers of Brazil & Argentina were benefitting from currency devaluation for export of commodities. In Argentina, export taxes abolished on all commodities except Soya. Further need for import license for agrochemicals was removed. Demand of fruits, vegetables & flowers remained strong for domestic and export markets. Insecticide segment declined due to BT technology on soybean in Brazil.
In Europe, UPL Organic portfolio performed well for growing demand in organic farming. Fungicide business in potato & vine crops grew well. Dry summer in North affected cereal fungicides usage and reduction in sugarbeet area affecting herbicides market.
In North America, sales of the company’s new herbicides (Lifeline & Satellite) were increased as per expectation. Resistant weeds infestation continues to increase in soya, cotton and corn. Non-selective herbicides faced significant price competition. Fungicide consumption reduced due to continued dry conditions in Western USA. Insect pressure remained low in field crops affecting use of insecticides. Reduction in rice & cotton area affected rice herbicides & cotton insecticides.
Besides, increased registrations in African countries improved market access. Excellent acceptance of UPL cotton portfolio in Pakistan, though consumption got affected due to floods.
North Africa & Iran expected to grow with US lifting the economic embargo. Significant citrus / berries crop damage in Turkey due to frost / hail storm affected fungicides consumption. New season (Rice) did not meet expectation due to prolonged dry condition in SE Asia.
UPL has two other listed firms -- Advanta and UEL. Last November, UPL had announced merger of Advanta with itself as part of its strategy to provide all agri-solutions through single entity.
Post-merger, UPL's geographical reach would expand and result in cost savings of Rs 90 crore annually.
In January, the fair trade regulator CCI had approved the merger of seed firm Advanta with UPL.

Source: UPL
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