UPL Ltd. has registered a 43% drop in its PAT at Rs 792 crore in Q4FY 23 compared to Rs. 1, 379 crore in the corresponding period last year. However, the agrochem major has registered 4 per cent growth in its revenue for the quarter at Rs 16,569 crore compared to Rs. 15,680 crore during Q4 FY 22.  The quarter was impacted by rapid decline in product prices and delays in planting season that resulted in headwinds for product placements.

Meanwhile, UPL’s FY23 Revenue grew by 16% YoY to Rs. 53,576 crore, led by better product realizations (+10%), favourable currency impact (+5%) and flat volumes. FY23 EBITDA grew by 10% YoY to INR 11,178 crore as against Rs. 10,165 crore in FY22. EBITDA margins were lower mainly due to weaker-than-expected performance in Q4 impacted by headwinds in the post-patent space, which offset the healthy performance delivered during the first nine months.

Commenting on the performance, Jai Shroff, Chairman and Group CEO – UPL Ltd.,said “We delivered a resilient set of results for FY23 despite facing significant headwinds in the final quarter. Thanks to the dedication, agility, and tenacity of our teams, we were able to deliver on most of our commitments.

“We reduced our gross debt by over $600 Mn and net debt by $440 Mn driven by improved cash flow from operations and a leaner working capital cycle.

“In-line with our priority of creating shareholder value, we created distinct pure play platforms during the year to bring in enhanced focus and operational freedom to pursue independent growth strategies thereby unleashing the growth potential of each of our distinct platforms.

“Going forward, as we look ahead to FY24, we are well-positioned to deal with the market headwinds and deliver better profitability growth. In the longer-term, we remain confident of achieving our growth ambitions and transforming the food value chain with emphasis on sustainability.”

Mike Frank, CEO, UPL Global Crop Protection, said “FY2023 was a tale of two distinct periods, our performance in the first nine months delivered >20% growth in Revenue and EBITDA. The fourth quarter was an unusual one with pricing pressure and delayed purchases by channel in the post-patent space  due to oversupply of certain molecules. Our focus in the last quarter was to grow share in key markets, liquidating most of our high-cost inventory, closely manage working capital and smartly set-up our inventory position for the next year.

As a result, given our lean inventory position, we are well-placed to deal with the challenging market conditions which are likely to persist for first half of FY24, but also to benefit once the market begins to normalize thereafter. Backed by our superior manufacturing and product innovation capabilities, we remain confident of growing significantly faster than the market in FY24 and beyond “

Debt Update

During the year, the company generated strong cash flows and utilized it towards deleveraging the balance sheet and returning cash to shareholders. The gross debt was reduced by US$617 million and net debt by US$ 440 million (Net Debt of $2.06 billion as of 31st March 2023).

Other Developments for the Quarter:

• UPL’s GHG emission reduction commitments have been approved by Science Based Targets initiative (SBTi) in-line with below 2°C global temperature rise trajectory. As a part of this, UPL has committed to reduce scope1 and scope2 GHG emissions by 63% per ton of production by FY2035 from FY2020 base year and scope3 emissions by 42% per ton of production over same timeframe

• UPL won KPMG India ESG Excellence Awardsin the category for Environment Initiatives in Energy, Natural Resources and Chemicals