India: Ambuja and ACC report profit rises for 2Q16

LafargeHolcim’s Indian subsidiaries ACC and Ambuja Cements have both reported an increase in profits for the second quarter of 2016.

In the three months to June, Ambuja Cements’ net sales were up only modestly, climbing 1.9 per cent to INR25.4bn (US$378m), but profits rose much faster. These reached INR4bn (US$59.4m), a rise of 76.5 per cent YoY.

Ambuja’s increased profits were mainly driven by lower power and fuel costs. Over two-thirds of the higher profit margins can be traced to the fact that Ambuja’s energy bills were a fifth lower in 2Q2016 than they had been a year earlier.

The story for ACC is similar. While volume sales declined by 1.3 per cent YoY to 6.12Mt and revenues fell by 3.1 per cent to INR28.7bn (US$427m), net profits climbed by 79 per cent to INR2.4bn (US$35m).

In ACC’s case, both falling energy and transport costs helped to boost the firm’s profitability, even in the face of declining sales.