UPL Ltd reported a net loss of Rs. 384 crore for the quarter ended June 2024 compared to a net profit of Rs. 166 crore in the same quarter last year. Revenue growth for the June quarter was flat at 1 per cent at Rs. 9,076 crore over the same period last year’s Rs. 8,963 crore. The revenue growth was driven by a 16 per cent increase in volumes, a 14 per cent decline in prices and a negative foreign exchange impact of 1 per cent, the company said.

UPL’s 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 per cent and EBITDA drop of 30 per cent year on year.

Commenting on the Q1FY25 performance, Mike Frank, CEO, UPL Corporation Ltd., said: “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.

“Herbicides led the growth in North America, driven by glufosinate and clethodim. Our herbicide performance in Brazil also did well. Fungicides growth was led by higher volumes in Europe and North America.

“Revenue growth in our Natural Plant Protection (NPP) business was impressive, up 10% versus last year, driven by a strong performance in Europe, among other regions.

“Our contribution margin compressed by ~600 bps vs Q1FY24. 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.

“From an SG&A perspective, we continue to remain disciplined, and the organization is focused on making improvements in the operating model and driving efficiency throughout the enterprise.” 

Commenting on the Q1FY25 performance, Ashish Dobhal, CEO, UPL SAS, said: “On our India Crop Protection business (UPL SAS), we continued our efforts to restructure the business through strict credit policies and tighter credit terms, which lead to a postponement of sales closer to season, and the consequent impact on Q1FY25 revenues. However our contribution margins and cash flows have improved and working capital reduced, giving us the confidence that this is the right structural move for us in India.”

Commenting on the Q1FY25 performance, Bhupen Dubey, CEO, Advanta, said: On our global seeds platform, Advanta, we saw some headwinds in Q1FY25 on account of weather challenges that impacted production, created inventory shortages and supply constraints, leading to the impact on sales and EBITDA margins.”

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 optimizing our inventories and other working capital items.