UPL Q1 Results: Reports Higher-Than-Expected Loss

UPL Ltd. reported a net loss in the first quarter of fiscal 2025, which was higher than analysts' estimates.

The agro-chemical manufacturer posted a net loss of Rs 527 crore in the quarter-ended June, according to an exchange filing on Friday. This compares with a net loss of Rs 320 crore, as per consensus estimates of analysts tracked by Bloomberg.

• Revenue up 1.1% to Rs 9,067 crore versus Rs 8,963 crore (Bloomberg Estimate: Rs 8,773 crore).

• Ebitda down 13.5% to Rs 1,101 crore versus Rs 1,273 crore (Bloomberg Estimate: Rs 1,193 crore).

• Margin at 12.1% versus 14.2% (Bloomberg Estimate: 13.6%).

• Net loss of Rs 527 crore versus profit of Rs 102 crore (Bloomberg Estimate: Loss of Rs 320 crore).

• Revenue growth for the first quarter was flat at 1%, driven by 16% increase in volume, 14% decline in price and a negative 1% forex impact.

• Seeds business faced headwinds on account of weather challenges that impacted production, created inventory shortages and supply constraints, leading to a revenue drop of 7% and Ebitda decline of 30% YoY.

• Net debt increased by $639 million in Q1 FY25, as against $1,136 million over the same period last year.

"Overall, for FY25, we continue to focus on margins, the benefit of which is expected to get more pronounced in the second half of the year. Our focus on cash generation continues, and we are optimising our inventories and other working capital items," said Mike Frank, chief executive officer, UPL Corp.

“We continue to see strong fundamentals in the global crop protection market, with farmgate demand for our products at or above last-year levels in most regions, he said.

"Our contribution margin compressed by ~600 bps versus Q1 FY24. This was primarily due to price decline, and partially offset with lower cost of goods. Increased freight costs and foreign exchange were also headwinds on margins this quarter," Frank said.

Shares of UPL closed 5.06% lower at Rs 532.10 apiece, as compared with a decline of 1.17% in the benchmark Nifty 50.