ponni sugars erode ltd share price Management discussions

Industry structure and development World Sugar

Industry Structure

Sugar is produced dominantly from sugarcane, while about a fifth is from beet. Though beet has recorded robust rise in yield, crop area has steeply risen for sugarcane essentially from tropical countries. Ethanol production consumes about 15% of the world sugarcane harvest but consistently constitutes over one-half in Brazil. India is fast catching up in its bid to absorb surplus sugarcane into ethanol production that helps in concomitant cut in sugar production to achieve sustainable demand-supply parity.

Brazil barring few years of exception has been the top world sugar producer and exporter while Thailand is normally the second largest exporter. India occasionally challenges this pecking order to emerge as top producer and second largest exporter. World trade volume represents about one-third of production, the rest being used for captive consumption in the country of origin. Import demand is well geographically distributed as opposed to exports essentially coming from concentrated pockets. China is the world?s largest importer followed by Indonesia.

India remains unchallenged as the top consumer of sugar despite low and near static per capita consumption. It has become a structurally surplus sugar producer in the past decade and a regular exporter in the world market, albeit interfered with periodical export quota fixation by the Government.

Consumption growth has decelerated from the average of 2.4% since 1960s to around 1.8% in the last decade. Consumption has steadily shifted from the western hemisphere towards east. Demand growth is decidedly driven by increasing population and improved per capita income of such growing population. However, direct demand has dampened of late due to heightening health concerns and sterner State intervention through sin-tax levy and red-labelling mandate. Institutional consumption, on the other hand, has been growing in emerging economies almost in tandem with the growth in national income.

World sugar prices are highly volatile wherein the price volatility for raw sugar is generally higher compared to white sugar. World prices for white and raw sugar are strongly co-related. There is clear statistical inverse relationship between prices and stocks, expressed by the relationship of stock to consumption. There exists a small positive corelation between the price of sugar and oil.

Status update

World production that remained near flat for three years is well poised to record a robust rise in 2022-23 crossing 180 mln tonnes to mark a new record. This rise is essentially contributed by a significant surge in Brazil?s production followed by Thailand. India and EU suffered a reversal. Year-end stock would also mark a new high in absolute volume, though not so as a percentage to consumption.

Trade facilitation remains crucial to the health of the global economy. The impact of the Russia-Ukraine conflict, lockdown in China and container capacity issues have discernibly declined in recent months. This has allowed sugar to be transacted using longer sea voyages, aided by fall in freight rates and helped the Brazilian sugar to be sourced for most distant destinations without compromising competitiveness.

World raw prices showed strident volatility at the start. After touching a 5-year high in May ‘22, it plummeted to a 4-year low in the next couple of months. Buoyed by the shrinkage in shipment from India, world prices strikingly started strengthening since Nov ‘22. After crossing a 20 c/ lb mark in Feb ‘23, the strong undertone of the market led to lightning rise to cross 24 c/lb by mid Apr ?23 that is an 11-year high! The futures market has for three years been in a contango structure. As a corollary, the backwardated structure in the futures market between spreads has got corrected.

Indian sugar

Industry structure

Indian sugar industry is characterized by the coexistence of private, cooperative and public sector. It is inherently inclusive, supports over 50 million farmers and their families and finely fits into the Aatma Nirbhar Bharat mission of the Government. It is rural centric and hence a key driver and enabler for village level wealth creation. Sugar is India?s second largest agro-based industry after Textiles. It has tremendous transformational opportunities to meet the country?s food, fuel and power needs in an eco-friendly manner.

Sugarcane and sugar production are seasonal with more than 90% happening in the winter months of November to March. Sugarcane use for production of sugar has steadily increased over time in preference to alternative sweeteners. UR Maharashtra and Karnataka are the dominant sugar producing States accounting for 85% of country?s production that would meet more than entire domestic consumption. Household sugar consumption is about 35% with per capita consumption below 20 kg that is far lower than Brazil, US and Europe.

Sugar is largely sold as a commodity with branded sugar at its nascent stage in India, though growing at a CAGR of 8%. It is a niche market with more people opting for it on the fear that loose commodity may contain dust, foreign particles and touched by multiple people. Out of the household sugar consumption of 11-12 mln tonnes a year, hardly 3% is branded as compared to the share of branded product in edible oil segment at 50-55%. Also there are just few players in every geographical area with no single brand penetrating all India market.

Sugar industry reforms remain overdue despite growing consensus on the economic imperative to not delay same. In particular, the desolate disconnect between sugar and sugarcane price demands a decisive and lasting solution. NITI Aayog too came out with a report of its Task Force on Sugarcane and Sugar in April 2020 besides CACP religiously reinforcing its recommendations on this in its annual cane pricing policy reports. Food Ministry in turn constituted a working committee in Apr ‘21 to engage with stakeholders and evolve a mechanism for implementation of these recommendations. It remains regretfully a work in progress for a little too long.

Paradigm shift to ethanol

India has since become a structurally surplus sugar producer. Sugar exports to deal with this surplus is impeded by our skewed cost structure on account of high cost of cane. Exports are hence feasible only when world prices are bullish or subsidized through Government sops, the latter facing the wrath of WTO norms.

Realizing this, the Government firing all cylinders has painstakingly promoted the ethanol blending that amidst altruistic advantages helps subsume the surplus sugar in the system. This paradigm shift in ethanol focus has propelled the industry to a higher trajectory and concomitant re-rating in its valuation.

Having achieved the 10% blend in quick time, India is well poised to hit 20% blend by 2024-25 that should push the country to the top slot after only Brazil in achieving such a high mix.

Travails of Tamil Nadu

Tamil Nadu produced below 10 lakh tonnes of sugar for 4 years in a row till SS 2020-21, a frustrating fall from the peak of 26 lakh tonnes in SS 2006-07. Successive years of drought stoically sucked the staying power of several private sector players. Egregious losses and consequent enervated finances mowed down most private sector mills to a moribund state, while the cooperative mills linger on with liberal Govt funding support. There has been welcome recovery from the low of 7 lakh tonnes in 2017-18 but yet its pace is below par.

The State has been fast losing on its competitive edge in terms of size, season duration and sugar recovery juxtaposed to other major sugar producing regions. Further, TN sugar mills are mandated to bear in full the transport cost for sugarcane, while in all the other States the statutory cane price is inclusive of transport cost. Still worse, TN Government has discontinued its partial subsidy support for this from SS 2020-21. With TN sugar mills already reeling under high cost pressures due to despicable sugar recovery and dismal capacity utilization, this add on burden is outright onerous and overwhelmingly beyond their bearing.

TN sugar industry in collaboration with the renowned ICAR-SBI, Coimbatore launched in Oct ‘16 a Sweet Bloom project to identify and develop viable cane varieties relevant to the State. The new cane variety Co 11015 so spotted showed early promise during trials and its planting was progressively scaled up.

However, its yield performance for the ratoon crop is below par, dissuading farmers from embracing this variety. A couple of other varieties tried too fared poorly compared to the long established cane variety Co86032. Thus TN sugar industry is unsuccessful yet to strike at a sustainably improved cane variety, despite six years of concerted efforts. Sweet Bloom project version-2 being undertaken by SISMA in collaboration with ICAR-SBI now remains the industry?s best bet.

Status update

Sugar production during SS 2021-22 touched a new peak at 358 lakh tonnes. Notably this came after subsuming 32 lakh tonne of sugar by diversion to ethanol. Maharashtra re-emerged as the top producer after five years.

India achieved steady and startling rise in sugar exports since 2016-17 that peaked to 11.2 mln tonnes in 2021-22. The Government however in a policy reversal in May ‘22 shifted sugar exports from OGL to restricted list. It capped SS 2021/ 22 exports to 100 lakh tonnes that later was relaxed to 112 lakh tonnes.

Sugar production during 2022-23 season is slated to slide to below 330 lakh tonnes, a decline of 8 % YoY This is due to late rains impacting cane yields in both Maharashtra and Karnataka. Indeed, Maharashtra would swiftly slip to the second slot behind UP after regaining its top rank hardly one season before. While the Government in Nov ‘22 fixed an export quota of 60 lakh tonnes, no additional quota may be forthcoming by reason of lower production over initial estimates. At a time when global prices are ruling at about 18% premium to domestic prices, Indian sugar industry has been shut out of the opportunity to make optimum use of this window.


Cogeneration of power was conceived three decades ago to diversify the revenue stream and counter the cyclicality in sugar business. After the advent of Electricity Act, 2003, the promotional measures pursued under Government initiative by way of preferential tariff, assured off-take and long term power purchase agreement helped attract huge investment in bagasse based cogeneration of power.

Cogen however has lamentably lost much steam in recent years. Returns are hit by surplus power situation, falling tariff and improved connectivity that are no doubt welcome from a macro perspective. This has however turned high cost investments since FY ?17 in cogen unviable by dint of declining power tariff and steadily rising maintenance cost, parlously pulling down power margins. Availability and price of alternative fuels remains a challenge.

Having failed in its earlier attempts to bail out State Discoms and discipline the power market, Gol brought in new set of Rules and Regulations in 2022. The Electricity (Late Payment Surcharge and Related Matters) Rules, 2022 that came into effect from 3rd June 2022 brought in sterner measures to deal with liquidation of old outstanding dues as well as clearance of current dues with punitive measures for default. The new Rules however are like the typical curate?s egg. In particular, the Rules provide for liquidation of old outstandings over an inordinately long duration of 48 EMIs. Adding fuel to fire, it mandates zero interest compensation during such long period of delay. It is pretty paradoxical that the prodigal Discoms get rewarded at the

cost of a performing and non-defaulting power producer in the bargain! On the positive side, the EMIs to clear past dues are getting paid scrupulously adhering to the timeline, while current dues are also honoured with only marginal delay.

Further, bagasse based cogeneration units suffer undue delay and ultimate loss of revenue by dint of Regulators dragging their feet from timely revision of tariff. The two-part regulatory tariff under the cost plus template unequivocally warrants annual revision in the variable cost component essentially to cover the fuel cost escalation. But the time lag due to dithering and eventual denial of higher tariff for long periods lead to gross under recovery in the cost of producing power and in turn denude the guaranteed ROI. The ‘control period? under the tariff regulations would need strict conformance.

REC mechanism was conceived to devise a tradeable instrument to incentivize renewable energy production. With lackadaisical enforcement, its intended objectives get hardly realized. Further the Regulator was periodically lowering the floor and forbearance price and indeed the floor price has since been scrapped. To top it all, CERC-REC Regulations, 2022 now disqualify captive consumption from saleable REC entitlement. This strikes a lethal blow to renewable energy projects like that of our company that came to be established on the strength of stated policy incentives to promote renewable energy capacity in the country.

Bagasse based cogeneration brings to bear multitude of benefits to the economy and environment. Power supply is closer to the destination rural markets, while fuel efficiency gets optimized in the factory. Above all, the incremental revenue from power supports sugarcane price payment particularly during times of distressed sugar price. It hence calls for renewed policy thrust to revitalize renewable energy production from bagasse.


The Ethanol Blending Program (EBP) with petrol in the country has had a chequered progress. Introduced first in 2003 and reinforced again in 2007 with a 5% blend target, the actual mix remained tardy low. For the first time, ethanol blend reached 5% during Ethanol Supply Year 2019-20, that rose to 8.5% in 2020-21 and recorded 10% in 2021-22. The rollicking rise in blend % is thus both swift and substantive.

GoI has doubled-down its efforts to promote ethanol production in the country from multiple feedstocks, while sugarcane would in all probability remain the principal source. Flex fuel engines would be rolled out to give customer the choice of fuel. Studies are on for developing a technology to blend ethanol with diesel. GST on ethanol blended petrol has been lowered from 18% to 5% from 1st January 2023. GoI is thus blazing all guns to bolster ethanol production and consumption.

GoTN on its part has come out with the ‘Ethanol Blending Policy 2023? notified on 18th March 2023. It is holistic to deal with all facets of ethanol production and sale. It has welcome clarification on the regulatory and tax issues as well.

Brazil, the pioneer in EBP which started it way back in 1975 took 25 years to raise the blend mandate from 10 to 20%. Viewed so, India?s resolve to double the blend in just about 3 years would seem audacious, but with committed pursuit achievable.

Government Policies

(i) Sugar

• GoI imposed stock holding norms and introduced MSQ for sugar from June ?18 that continues to remain in vogue.

• GoI raised the MSP for sugar from Rs 29 to Rs 31/ kg in Feb ?19 that remains unrevised till date.

• GoI has discontinued the export subsidy from SS 2021/22.

• GoI in May ?22 shifted sugar exports from OGL to restricted category and capped total exports at 100 lakh tonnes for SS 2021 /22 - Additional 12 lakh tonnes allowed in August 2022.

• GoI notified MAEQ for SS 2022/ 23 at 60 lakh tonnes, allocated same mill-wise and made it tradable.

• Compulsory jute packing for sugar continues at 20% for Jute Year 2022-23.

(ii) Cane price

• GoI in Aug ?22 announced increase in FRP by Rs 15/ qtl to Rs 305/ qtl for SS 2022-23 that is linked to base recovery of 10.25% (increased from 10% of previous season).

• GoTN discontinued the transport subsidy of Rs 100/ t for the sugar mills since SS 2020-21; industry to bear full transport cost.

• GoTN offers Rs 195/ tonne incentive price for cane.

(iii) Cogeneration

• TNERC is yet to announce revised tariff for Control Period 2022-24, though Consultation Paper was issued in Jan ‘22.

• MoP in June 2022 notified the Electricity (Late Payment Surcharge and Related Matters) Rules, 2022. It allows Discoms to pay the legacy dues over EMI enuring up to 48 months, free of interest.

• MoP in July ?22 notified the RPO trajectory till 2029-30.

• CERC in May ?22 notified REC Regulations 2022. It curtails sale entitlement of REC available to captive generating stations.

• CERC lowered the cap from Rs 12 to Rs 10 per unit for power sold in all market segments.

• CERC has extended the applicability of its RE Tariff Regulations by six months up to 30.09.2023.

(iv) Ethanol

• GoI in NovRs 22 notified higher ex-mill price of ethanol for supply to public sector OMCs during ethanol supply year 2022/ 23.

Feedstock ESY 22 ESY 23
C-Molasses 46.66 49.41
B-Heavy Molasses 59.08 60.73
Sugarcane juice/ syrup 63.45 65.61

• ESY redefined as 1st Nov of a year to 31st Oct of the following year effective 1st Nov 2023.

• GST reduction on Ethyl Alcohol supplied to OMCs for blending with petrol from 18% to 5% effective 1st Jan ?23.

• GoTN announced Ethanol Blending Policy 2023 on 18th Mar ‘23.

Opportunities & Threats

India has a low per capita consumption of sugar with growing income. Its large domestic market provides a strong platform to leverage local production for capturing global market. This however demands cane cost optimization through improved farm productivity and high sucrose cane variety, besides effectively tapping the byproducts for greater value addition.

Ethanol presents an elegant value chain for sugar industry. Government policies are directed towards increasing the ethanol blend in petrol and concurrently cutting sugar surplus through premium pricing for ethanol produced by

way of sugar substitution. Indeed, the Government has advanced the EBP target to reach 20% blend by 2025 and is encouraging ethanol production from multiple feedstocks besides sugarcane.

Sugar business is intrinsically cyclical, but India has emerged structurally surplus over the last decade. Markets tend to over react to demand-supply disequilibrium, causing volatile change in product pricing. Cogeneration and Ethanol have turned significant value creators to soften the adverse fall out of sugar surplus. Sugar exports and ethanol production from diverted sucrose now play a stellar role to declog the glut and correct closing sugar inventory to desirable level.

Sugarcane is a robust crop but its availability is critically dependent upon nature. Repeated monsoon failure, frail flow in river Cauvery and dead storage level in Mettur reservoir that caters to the company?s command area of cane together throw up a tantalizing challenge to agriculture in its neighbourhood, thwarting cane cultivation in the process. Drip irrigation is catching up but the high capital outlay, glitches in Government subsidy schemes and deficiency in water resources not enough to meet even the minimal drip requirement for cultivation during deficit years impede its pace of adoption.

Harvest labour shortage increasingly poses an intimidating challenge to both the cane farmers and mills in the State. In particular, harvest charges in TN are twice or thrice compared to other major sugar producing regions. Frequent and excessive absenteeism ineluctably interrupts daily crushing schedule. Mechanization, though not a panacea with several imponderables associated with it, is no longer a matter of choice but is fast emerging as a dire necessity for sugarcane harvest in TN.

The disconnect between sugar and sugarcane prices in the absence of Price Stabilisation Fund advocated by CACP creates periodical pressures, more particularly during industry downturn. Sugarcane pricing reform is overdue.

Sugar industry is criticized on two counts. While its end product, viz. sugar is sledge-hammered as a health hazard, the raw material i.e., sugarcane is condemned as water guzzler. Much of these are over-blown but the underlying message should merit and meaningfully warrant dispassionate introspection. Accordingly, ISMA has taken the lead to spread right awareness, while simultaneously underpinning the need for a holistic and pragmatic approach.

Segment-wise or product-wise performance

The Company is engaged in two segments, namely Sugar and Cogeneration of power (Cogen). The segment-wise performance for the year is as under:

Particulars Sugar (tonnes) Cogen (Lakh units)
Production 91326 1213
Sales 89070 850
lakhs lakhs
Sales 30882 4148
Operating Profit 2727 2174


World sugar prices have shown strong resurgence in the backdrop of production pressures in key countries like India, Thailand and China. In turn, it has tilted price parity in favour of sugar over ethanol. As a result, Brazil can be expected to hit a new record in its production. India more likely will have continuing export caps, given its frail stock levels and fastidious focus on ethanol. Global sugar prices should hence stay strong in the near term.

India would for sure start SS 2023-24 with minimal and manageable inventory levels. While production would in all probability be far higher than domestic demand, export and ethanol together should be able to tackle the emerging surplus. Sugar margins can be expected to strengthen, piggybacking on extant demand-supply equilibrium.

Sugarcane planting in TN that picked up in the last couple of years, has again started showing stress. High cost of farm labour and better returns from competing crops have together dampened farmer?s interest in cane crop. With sugar prices hovering at levels below those prevailed five years ago, there is persisting margin pressure for the sugar mills that limits their financial capability to offer higher cane price or diverse forms of incentives to rejuvenate cane planting. There is thus a sustainable crisis for the industry in the State.

Amidst macro-level challenges outlined above, our company is relatively better placed to combat these headwinds as detailed in the Board?s Report.

Risks and concerns

The management cautions that the risks outlined below are not exhaustive and are for information purposes only. Investors are requested to exercise their own judgment in assessing various risks associated with the industry and the company.

Industry risk

Sugar industry being agro based and in commodity business is fraught with seminal climatic and cyclical risks. It has to source sugarcane from its neighbourhood and out of command area where growth and availability hinges upon monsoon and water table. Despite recent liberalization by Centre, there are continuing controls on cane area, cane pricing and periodic market intervention measures.

Cogen tariff is determined by the Regulator for supply to TANGEDCO under a long term PPA that is currently unfavourable compared to prevailing market rates. There are growing litigations in the appellate forum (APTEL) on the tariff determination process, multiplicity of charges, purported move to migrate to competitive bidding posing palpable uncertainty in the continuity of current PPA and captive consumption tax. The final outcome on any and all of these would have considerable impact on the company.

Ministry of Power through the Electricity (Late Payment Surcharge and Related Matters) Rules, 2022 mandates that all old dues are now payable over 48 EMIs without interest. This entails considerable interest loss for the affected players, including our company, besides choking current liquidity.

Risk mitigation

The Company has built enviable relationship over the years with the local farming community. It has judiciously used surplus cash generated during industry upturn to pare debts and stay lean and financially fit. It has diversified into Cogen. It has of course little control over agro-climatic risks, regulatory interventions and market risks.

Risk specific to the Company

Erode Sugar Mill is squeezed for land in its factory area that impedes scope for major expansion or diversification plans. Prospects for cane area expansion is listless. Of late, its command area for cane has become increasingly susceptible to water stress.

GoI policy push to help sugar industry of late is centered on ethanol. The company?s plan to set up ethanol unit is making slow progress due to cumbersome and time consuming process for environmental clearance. Specific guidelines/ clarifications have been sought from GoTN under the new Policy for locating the ethanol plant within the existing sugar mill complex with permission to produce all co-related products such as ENA and RS. Its response is awaited.

The company?s location is densely populated and distillery project is prone to public resistance on perceived threat of polluting the water-bodies in the neighbourhood. The ethanol project of the company is planned on state of the art technology to ensure zero liquid discharge and protect the environment.

Risk Management

The Board being responsible for framing, implementing and monitoring the risk management plan for the company has laid down the framework for risk assessment and mitigation procedures. It has set out detailed framework to deal with key areas of risks encompassing raw material risk, product price risk, regulatory risk, finance risk and risk specific to the company. It has put in place adequate system to keep its key operating team aware and beware of the likely risk factors. Internal control systems and internal audit checks help the company continuously monitor emerging risks and take timely corrective action. There is no element of risk in the opinion of the Board which may threaten the existence of the company.

Disclosure of strategy

SEBI circular dated 10.05.2018 requires listed entities to consider disclosure of medium-term and long-term strategy within the limits set by its competitive position based on a timeframe as determined by its Board of Directors. It further requires articulation of a clear set of long-term metrics specific to the company?s long-term strategy to allow for appropriate measurement of progress.

Pursuant to the above, the Board of Directors in Oct ?18 considered and approved the long-term strategy and medium-term strategy for the company. For this, the Board has set 3-5 years tenure for medium-term and more than 5 years for long-term in deciding appropriate strategy. The long-term and medium-term strategies are disclosed in the company website -www.ponnisugars.com.

Internal Control Systems and their adequacy

The Company has proper and effective internal control systems commensurate with its nature of business and size of operations to ensure that all controls and procedures function satisfactorily at all times and all policies are duly complied with as required. These are considered adequate to reasonably safeguard its assets against loss or misappropriation through unauthorized or unintended use.

There is adequate and effective internal audit system that employs periodic checks on on-going process. The Audit Committee of the Board of Directors regularly reviews the effectiveness of internal control system in order to ensure due and proper implementation and due compliance with applicable laws, accounting standards and regulatory guidelines.

Human Resources

The Company employs 158 seasonal and 126 non-seasonal employees. Industry-wide wage settlement expired on 30th September 2018. Renewal talks have since begun and the new accord should be reached soon. Industrial relations remained cordial throughout the year.

Discussion on Financial Performance with respect to Operational Performance Operational Performance

Year ended
31.03.2023 31.03.2022
Number of days 306 249
Average Crushing rate (tcd) 3013 2596
Cane Crushed (t) 921849 646407
Recovery (%) 9.94 9.84
Sugar produced (t) 91326 63555
Power production (lakh kwh) 1213 875

The company?s operational performance sets several records during the year. Cane volumes increased by over 40% that was just a tad below the highest 15 years ago. Crushing rate, often times interrupted by harvest labour shortage, was still an all-time high. Power production and sale peaked and for the first time crossed 60% PLF. There was all round operational excellence with optimal utility consumption and cost saving. Details are covered in the Board Report.

Financial performance

(Rs crores)

Year ended

31.03.2023 31.03.2022
Total Income 450.49 295.32
Profit Before Interest, Depreciation & Tax 55.55 42.53
Profit Before Tax 47.62 35.97
Profit After Tax 38.34 29.25

The financial performance is underpinned by improved operations and marked uptick in off-take. Our turnover for the first time crossed .400 crores benchmark. Despite near static sugar prices and negative correction in molasses and power realization, there is startling improvement in our profit performance. Our bottom-line no doubt was boosted by one time gains through interest realization from power dues and swapping our export quota but is noteworthy for being the highest in over a decade.

Key Financial Ratios

Description U/M 2022-23 2021-22 Change % Explanation
Operating Profit margin (PBIDT / Total Income) % 12.33 14.40 (14.38) Narrowing differential between input-output prices
Net profit margin (PAT / Net Sales) 0/ % 8.81 10.14 (13.12) -do-
Interest Coverage Times - - -
Return on capital employed 0/ % 17.80 15.59 14.18 Increased volume of operations.
Return on Net worth % 18.75 16.28 15.17 -do-
Earnings per share 44.58 34.01 31.08 -do-
Debt Equity ratio Times - - -
Current ratio Times 3.00 3.29 (8.81) Part of power dues converted to long term EMIs
Net worth per Share 295.45 256.91 15.00 Improved results on increased sale of operations.
Debtors Turnover % 1.73 1.18 46.61 Increase in turnover.
Inventory Turnover % 5.60 4.56 22.81 -do-

Cautionary Statement

Statements made in this Report describing industry outlook as well as Company?s plans, projections and expectations may constitute ‘forward looking statements? within the meaning of applicable laws and regulations. Actual results may differ materially from those either expressed or implied.

For Board of Directors
N Gopala Ratnam
Chennai Chairman
28th April 2023 DIN:00001945