24-05-2025
Camlin Fine Sciences Ltd (BOM:532834) Q4 2025 Earnings Call Highlights: Strong Core Business ...
Total Turnover (Q4): INR 437 crores, up from INR 431 crores in the previous quarter.
Annual Turnover: Increased from INR 1,439 crores to INR 1,666 crores.
Core Business Revenue Growth: 15% year on year.
Core Business EBITDA: INR 208 crores in FY25, up from INR 184 crores last year.
Blinds Business Growth: 17% to 18% year on year, reaching INR 78 crores.
Aroma Revenue Contribution: INR 176 crores in FY25.
Net Debt Position: Improved from INR 564 crores to INR 492 crores.
Warning! GuruFocus has detected 7 Warning Signs with BOM:532834.
Release Date: May 23, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Camlin Fine Sciences Ltd (BOM:532834) reported a 15% year-on-year growth in its core business revenues.
The company's EBITDA for the core business improved to 12.5%, amounting to INR 208 crores in 2025, up from INR 184 crores the previous year.
The blends business experienced significant growth, particularly in North America and India, with an overall increase of 17% to 18% year-on-year.
The Aroma segment contributed INR 176 crores to revenue in FY25, with expectations of further growth due to anti-dumping duties in the US and Europe.
The company's net debt position improved from INR 564 crores to INR 492 crores, aided by a successful rights issue in January 2025.
Camlin Fine Sciences Ltd (BOM:532834) faced pricing pressure across most products due to competition, particularly from China.
The company reported increased losses from discontinued operations in Europe and China, with significant employee costs contributing to these losses.
Capacity utilization for the vanillin plant is currently at 45% to 50%, with plans to reach 100% in the next two years, indicating underutilization.
Employee expenses increased by 25% year-on-year, driven by business expansion in America and Europe and the addition of new personnel.
The company is experiencing a cash burn from discontinued operations, although efforts are being made to reduce these costs significantly.
Q: Could you share the volume of Vin exports to the US for March and April, and your understanding of the recent ADD and CVD duties on Chinese producers? A: Sharing specific data on US exports is not possible due to competitive sensitivity. The ADD is typically for 5 years. The price difference between Europe and the US is about 20-25%, with the US being higher.
Q: What is the current capacity utilization of the vanillin plant, and where do you see it in the next 2 years? A: Currently, the vanillin plant is at about 45-50% utilization. We aim to reach 100% capacity in the next two years as market development improves.
Q: What is the outlook for the blends business, and what EBITDA margins do you expect? A: We expect the blends business to grow by about 20% over the next 2-3 years. EBITDA margins are expected to improve and be in the high teens as certain thresholds are met.
Q: Are you facing any pricing pressure on your products currently? A: Yes, there is pricing pressure on all products except vanillin due to competition from China.
Q: Why have vanillin sales not picked up quarter-on-quarter? A: Sales in the US are affected by stock on sea and controlled sales due to expected price increases. We are waiting for better realizations.
Q: What is the status of the discontinued operations in Europe and China, and when will we see a reduction in losses? A: There are some one-time expenses this quarter, but employee costs will reduce by 90% next year. Discontinued losses should not exceed 8 crores in Q1 FY26.
Q: What is the current gross margin for vanillin, and what is the cost of production? A: The cost of production for vanillin is around $9, with current prices ranging from $12 to $13. Gross margins are expected to improve as capacity utilization increases.
Q: What is the impact of tariffs on your business, and how do you see the competitive landscape? A: Tariffs are difficult to predict, but we do not see a significant disadvantage. The blend business margins should remain stable despite competitive pressures.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
