Deepak Nitrite Delivers a Superlative Performance in Q4 FY19

MUMBAI and VADODARA, India, May 6, 2019 /PRNewswire/ --

Ranked among Fortune Next 500 and recognized among the top 25 wealth creators by Fortune Magazine, India, Deepak Nitrite (NSE: DEEPAKNTR) (BSE: 506401) is acknowledged as one of the country's fastest growing chemical companies. It has a diversified portfolio of intermediates that cater to the dyes and pigments, agrochemical, pharmaceutical, plastics, textiles, paper and home and personal care segments in India and overseas. Its products are manufactured across five locations, which are all accredited by Responsible Care. Deepak Nitrite Limited has announced its financial results for the quarter and financial year ended 31st March, 2019.

Deepak Nitrite Ltd., with a focus on technology leadership and a diverse product portfolio underlining its premier position in the Chemical Intermediates industry, has delivered a stellar performance in Q4 FY19 with highest-ever turnover and profit in its 48 year history. Each of the three business divisions have contributed to this record growth in Topline and profitability, taking total turnover of the Company for FY19 to Rs. 2,715 crore.

Deepak Phenolics Ltd. (DPL), where operations began just 5 months ago has achieved a quick ramp-up of capacity utilisation to over 80%. DPL has contributed to significant savings in forex for the Nation by establishing local manufacturing of Phenol and Acetone, which were hitherto imported in large numbers. DPL has closed the fiscal with positive EBITDA and Profit After Tax.

CMD's Message 

Commenting on the performance, Mr. Deepak C. Mehta, Chairman & Managing Director, said,

"The Chemical Industry in India is witnessing an unprecedented growth opportunity largely due to International Events. For a Company like Deepak Nitrite, which is into chemical intermediates, the opportunity stands accentuated as its products support a wide range of industries. In the current scenario, Chemical Intermediates are witnessing a big jump in demand both due to domestic end user industries growing and reduced availability of intermediates from China. We expect the situation to remain conducive for the foreseeable future.  

In this backdrop, DNL was able to ensure peak performance in spite of fluctuating availability and pricing of Raw Materials. As a result, fiscal year 2019 has been a defining year as the Company commissioned its mega-Greenfield facility of Phenol & Acetone, elevated the performance of all of its segments and more than doubled Consolidated EBITDA and PAT.  

I am happy to report that all of the divisions performed well and the DPL team has done an excellent job not only in ensuring peak plant performance but also in managing the logistics of over 300,000 tonnes of material and maintaining margins inspite of the fluctuating oil prices. On an overall basis, due to various initiatives, we expect to sustain the growth momentum across all segments in the ensuring quarters.  

The Board has recommended a higher dividend of Rs. 2 per share in FY19 amounting to 100% of Face Value to share the benefits of the robust performance and sustain the value creation focus towards all stakeholders." 

Financial Highlights (Standalone) 

Q4 FY2019 

• Revenues were Rs. 487.8 crore in Q4 FY19 compared to Rs. 399.3 crore in Q4 FY18, higher by 22% Y-o-Y. The Q4 performance is testament to the strategic choices of products identified for capacity expansion at the start of the fiscal. Apt assessment of market demand enabled DNL to reap benefits from higher realisations across key products even as overall volume growth was 11% yoy.
• EBITDA stood at Rs. 110.7 crore, higher by 100% as against to Rs. 55.4 crore reported in the same period last year. EBITDA margins improved sharply by 880 basis points to 22.7%, as compared to 13.9% in Q4 FY18. The Company's efforts at running plants at optimum capacities with streamlined processes were more than supported by the developments in the China market, all of which has combined to contribute to the enriched margin profile.
• PBT stood at Rs. 87.0 crore in Q4 FY19 increasing by a commendable 182% over Rs. 30.1 crore in the same period last year.
• Outstanding growth in PAT by 178% yoy to Rs. 56.6 crore in Q4 FY19 as compared to Rs. 20.3 crore in Q4 FY18.
• EPS for Q4 FY19 stood at Rs. 4.15 per share (of face value of Rs. 2 each) on an enlarged capital base as compared to Rs. 1.51 per share in Q4 FY18.

Performance Highlights  

Domestic & Exports 

• Domestic revenues stood at Rs. 344.5 crore in Q4 FY19 from Rs. 243.3 crore in the same period last year, delivering strong growth of 42% Y-o-Y. DNL's cost leadership and position as the only backward integrated plant in the world for OBA has enabled it to capitalise on evolving market opportunities for the Performance Products segment due to shutdown of capacities in China. This, along with expansion in key building blocks enabled us to cater to higher demand from end user industries resulting in robust topline growth.
• Revenues from exports came in at Rs. 138.4 crore in Q4 FY19 compared to Rs. 147.3 crore in Q4 FY18. Export performance was flat due to extended production schedules and transit timelines for select products, the impact of which is transitionary in nature. Export revenues are expected to recover in the subsequent quarter.

Update on Deepak Phenolics Ltd.
Deepak Phenolics Ltd. (DPL), a wholly-owned subsidiary of Deepak Nitrite Ltd., commenced commercial production at its Mega-Plant of Phenol & Acetone on 1st November, 2018. This facility, aligned with the 'Make in India' initiative of Government of lndia, has capacity to manufacture 200,000 MTPA of Phenol and 120,000 MTPA of its co-product Acetone. This is supported by capacity to manufacture 260,000 MT of Cumene for captive consumption. DPL is well positioned to benefit from strong demand growth in the local market for these products.
Following are some of the key milestones achieved by Deepak Phenolics Ltd. in Q4 & FY19:

- Turnover of Rs. 537 crore in Q4 FY19; maiden full quarter of operations
- Both plants (Phenol & Cumene) has touched 100% utilisation during the quarter
- Addition of DPL turnover propels cons quarterly turnover past the 1,000 crore mark
- DPL contributes 927 Cr to consolidated turnover of Rs. 2,715 Cr in FY19
- Reported positive EBITDA and PAT in Financial Year 2019, despite commencing opps only 5 moths ago
- DPL contributes 56 Cr  to consolidated PBT of Rs. 268 Cr in FY19

About Deepak Nitrite Limited 

Ranked among Fortune 500 and recognized among the top 25 wealth creators by Fortune Magazine, India, Deepak Nitrite (NSE: DEEPAKNTR) (BSE: 506401) is acknowledged as one of the country's fastest growing chemical companies. It has a diversified portfolio of intermediates that cater to the dyes and pigments, agrochemical, pharmaceutical, plastics, textiles, paper and home and personal care segments in India and abroad. Its products are manufactured across 5 locations which are all accredited by Responsible Care.  

Safe Harbour 

Some of the statements in this document that are not historical facts are forward-looking statements. These forward-looking statements include our financial and growth projections as well as statements concerning our plans, strategies, intentions and beliefs concerning our business and the markets in which we operate. These statements are based on information currently available to us, and we assume no obligation to update these statements as circumstances change. There are risks and uncertainties that could cause actual events to differ materially from these forward-looking statements. These risks include, but are not limited to, the level of market demand for our services, the highly-competitive market for the types of services that we offer, market conditions that could cause our customers to reduce their spending for our services, our ability to create, acquire and build new businesses and to grow our established businesses, our ability to attract and retain qualified personnel, currency fluctuations and market conditions in India and elsewhere around the world, and other risks not specifically mentioned herein but those that are common to industry. 

Media contact: 

Jaydip Chowdhury 
Head - Corporate Affairs & Communication
Deepak Nitrite Ltd.     
[email protected] 
+91-7573949521