COVID-19-induced lockdowns impact: Adani Ports Q1 net profit falls 26%

02:07 AM Aug 12, 2020 | Agencies

Adani Ports and Special Economic Zone Limited (APSEZ) on Tuesday reported 26.33 per cent decline in consolidated profit to Rs 757.83 crore for the first quarter ended June 30, impacted by COVID-19-induced lockdowns.

The country's largest integrated logistics player had clocked a consolidated net profit of Rs 1,028.69 crore in the corresponding period a year earlier, the company said in a BSE filing.


In terms of operational performance, Mundra port became the largest container handling port in India by handling 0.97 million TEUs in Q1 FY21, surpassing JNPT volume of 0.85 million.


"Lockdown measures to tame the spread of COVID-19 resulted in lower import and export, impacting cargo throughput in first quarter of FY21," the company said in a statement.

Its total income declined to Rs 2,749.46 crore for the first quarter, as against Rs 3,216.92 crore in the year-ago period.

The company's total expenses during the quarter under review rose to Rs 1,805.24 crore, compared to Rs 1,796.34 crore in the year-ago period.

"In the first quarter of FY21, we were able to perform operationally at par with pre-COVID levels. We kept supply chain running and stood by our customers to prove as a bankable service provider at all times ensuring stronger customer relationships and stickiness in cargo.

"During this period, we relooked at fundamentals of port operations and realigned costs, thus maintaining Port EBIDTA (earnings before interest, taxes, depreciation, and amortisation) margin of 70 per cent," Karan Adani, Chief Executive Officer and Whole Time Director of APSEZ, said in a statement.

During a conference call, he said volumes were down predominantly because of the lockdown.

With the worst behind, APSEZ has emerged operationally stronger and resilient to externalities, he added.

"Our focus continues on further improving efficiencies, reducing costs and closing out value accretive acquisitions namely Krishnapatnam Port and Dighi Port. We are happy to inform that we have signed up with Science Based Targets initiative (SBTi) and Task Force on climate related financial disclosure (TCFD) for reducing carbon emission with a commitment to become carbon neutral by 2025," Adani said.

The company has diversified its board by inducting PS Jayakumar as an independent director, he noted.

The resilience in the business is a testimony of the team's commitment to excel, Adani said.

The company said there has been a steady increase in cargo throughput across the ports from July 2020.

During July 2020, APSEZ handled cargo volume of 18.30 MMT, a growth of 6 per cent on year-on-year basis and 31 per cent over June 2020.

"This trend gives us confidence that worst is behind us and going forward cargo volume in FY21 is expected to stabilise. Shift from road to rail and increase in services enabled Adani Logistics to achieve a revenue of Rs 200 crore in Q1 FY21 vs Rs 181 crore in Q1 FY20 a growth of 10 per cent on a y-o-y basis," it said.

On becaming the largest container handling port in India, Adani said, "It does feel great to surpass JNPT and we are now looking at the target of achieving 450 MT of throughput by 2025".

As part of its cargo diversification plan APSEZ handled 2,46,000 tonnes of LPG and 3,74,000 tonnes LNG at Mundra Port during Q1 FY21.

In container terms, APSEZ handled 1.23 million TEUs as against 3.22 million TEUs handled at all India level, it said, adding the company is progressing towards achieving east coast and west coast parity in terms of distribution of assets and hinterland reach.

In logistics, Rail volume increased by 37 per cent from 56,060 TEUs to 76,925 TEUs.

Logistics Ltd currently operates 60 rakes and continues to be the largest private rail operator in India.

APSEZ is one amongst 43 Indian companies who have signed a commitment letter to Science Based Targets initiative.

About Krishnapatnam port acquisition it said: "We have received approval from CCI on Krishnapatnam Port acquisition and expect it to be completed in the current quarter".

On Snowman deal it said both the parties mutually agreed not to peruse the deal further.

It is a part of globally diversified Adani Group.

APSEZ's 11 strategically located ports and terminals - Mundra, Dahej, Kandla and Hazira in Gujarat, Dhamra in Odisha, Mormugao in Goa, Visakhapatnam in Andhra Pradesh, and Kattupalli and Ennore in Chennai - represent 24 per cent of the country's total port capacity, handling vast amounts of cargo from both coastal areas and the hinterland.

The company is also developing a transhipment port at Vizhinjam, Kerala and a container terminal at Myanmar.

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