UPL Q1 Results: Net Profit Falls By 81 Per Cent, Revenue Drops 17 Per Cent

The company logged a net profit of Rs 166 crore for the June quarter in the current financial year (FY24), a big fall from Rs 877 crore in the first quarter of the previous fiscal year

The company reduced its earnings guidance for FY24 majorly

Source : World Trademark Review Website

Chemical maker UPL reported a plunge in its net profit of 81 per cent on a year-on-year (YoY) basis in its first quarter (Q1) earnings on Monday. The company logged a net profit of Rs 166 crore for the June quarter in the current financial year (FY24), a big fall from Rs 877 crore in the first quarter of the previous fiscal year (FY23).

UPL recorded a 17 per cent fall in its revenue for Q1FY24 on a year-to-year basis. It posted a revenue of Rs 8,963 crores for the current quarter against its Q1 revenue of Rs 10,821 crores for FY23 in its exchange filing.

Explaining the factors behind the company’s performance, CEO Mike Frank said, “The global agrochemical industry has been going through a challenging phase over the last two quarters as distributors prioritised destocking and focused on tactical purchases amid high channel inventories. Additionally, the market is witnessing pricing pressure given the high base of previous year and aggressive price competition we have seen from the Chinese post patent exporters. Given this backdrop, our revenue and profitability were also impacted by these headwinds in line with the rest of the industry.”

The major dip in revenue for the company was seen in the North America region, where it declined 52 per cent, from Rs 1,796 crore to Rs 870 crore, on a YoY basis. While Europe region reported a 27 per cent fall in revenue from Rs 1,728 crore to Rs 1,259 crore, revenue from Latin America fell by 14 per cent from Rs 3,464 crore to Rs 2,965 crore, all on a YoY basis. India region reported a 1 per cent fall in revenue for the company of Rs 2,054 crore in the reported quarter, compared to Rs 2,067 crore from a year ago. Revenue from the rest of the world increased by 3 per cent to Rs 1,814 crore from Rs 1,765 crore, on a YoY basis. 

The company reduced its earnings guidance for FY24. It now expects revenue to grow at 1-5 per cent in FY24 as compared to 6-10 per cent earlier. The revised EBITDA growth guidance for the year stands at 3-7 per cent down from 8-12 per cent earlier.