BUSINESS

India Cements reports lower net profit

Special Correspondent

Lower production, higher maintenance expenditure impact bottomline

CHENNAI: The India Cements has reported a lower profit before tax of Rs. 100.41 crore during the quarter ended December 31, 2008, against Rs. 189.48 crore in the year-ago period, on a higher gross turnover of Rs. 877.78 crore against Rs. 855.74 crore.

After providing for taxation, the net profit for the quarter under review stood at Rs. 61.91 crore (Rs. 127.05 crore). He attributed the dip in net profit to increased provision for taxation and ‘exceptional expenditure’.

A combination of factors ranging from lower production to higher maintenance expenditure has impacted the bottomline. The full impact of coal price increase at its peak dollar conversion rates had only added further pressure.

Addressing a press conference here on Wednesday, N. Srinivasan, Vice-Chairman and Managing Director, said, “we earned less during the third quarter because we produced less due to extended shutdown caused by break-down of kilns at Chilamkur and Vishnupuram, necessitating major overhauls”. Production was down by almost four lakh tonnes in the third quarter compared to the previous quarter, Mr. Srinivasan said. The problems had since been gotten over, he added. However, increased blending and higher price realisation had compensated the loss of production to a major extent and contributed to a marginal rise in gross turnover, he said. “The market is not lost for us,” he said. He expected the current quarter to be normal. Mr. Srinivasan said the demand “will be alright for us until almost August-September.” He expected the industry to see some fresh capacity in the second half of next financial year.

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