NMDC (526371) Q1 24/25 earnings summary

Executive summary

• PBT and PAT increased by 19%-20% year-over-year despite a 14% drop in production volumes, attributed to strong financial management and operational efficiency.

• Revenue from operations remained stable at ₹5,378 crore, with EBITDA rising 20% year-over-year to ₹2,725 crore and margin improving to 51%.

• NSL reduced losses by half and is on track to achieve monthly and quarterly break-even by Q2 and Q3, with annual break-even targeted for the current fiscal year.

• Unaudited standalone and consolidated financial results for Q1 FY25 were approved by the Board, with no material misstatements identified by auditors.

• Supreme Court judgment on retrospective tax is being assessed; most liabilities are expected to be recoverable from customers due to consistent customer base and clear pricing terms.

Financial highlights

• Q1 FY25 iron ore production was 91.89 LT, down 14% year-over-year, and sales were 100.73 LT, down 8% from Q1 FY24.

• Standalone revenue from operations for Q1 FY25 was ₹5,377.80 crore, nearly unchanged from Q1 FY24.

• EBITDA for Q1 FY25 was ₹2,725 crore, up 20% year-over-year, with a margin of 51%.

• Average sales realization dropped from INR 5,304 in Q1 to around INR 4,304 due to two price cuts totaling INR 1,000.

• Fixed cost structure led to higher per ton costs when production declined.

Outlook and guidance

• Volume guidance for FY25 remains at 50 million tons, with confidence in making up the current 1 million ton shortfall by October.

• NSL aims to reach 1.5 million tons of hot metal production and break even by the end of the fiscal year.

• CapEx for FY25 is targeted at INR 2,200 crore, with expectations to exceed INR 3,200 crore by year-end.

• Capacity utilization is expected to reach 54 million tons in FY26, with incremental EC extensions anticipated.

• Forward-looking statements indicate potential variability due to market demand, competition, and regulatory factors.