Birla Corporation, the flagship firm of M P Birla group, today reported 8.85 per cent drop in its standalone net profit to Rs 57.46 crore for the quarter ended March 31, 2012, largely due to increased expenses.
The Kolkata-based firm had reported a net profit of Rs 63.04 crore during the corresponding quarter of 2011-12.
Net sales of the company, during the quarter under review, increased by 9.75% to Rs 651.36 crore vis-a-vis Rs 593.50 crore of Q4 of FY11, it said in a filing to the BSE.
The company did not provide consolidated results for the January-March quarter.
Total expenditure of the cement-to-jute manufacturer rose by 15.68% to Rs 599.02 crore in the quarter under review.
For the full year 2011-12, the company's net profit, on a consolidated basis, declined by over 25% to Rs 239.44 crore, though its net sales were up 5.80 per cent to Rs 2,246.87 crore.
"Apart from substantial increase in the cost of coal, power charges and freight, both rail and road, also impacted profits. The effective excise duty rate increased in the recent Budget had also added to the cost," the company said in a separate statement.
It quoted chairman Harsh V Lodha saying that "profit was impacted substantially because of the disruption of operations at the Chanderia unit of the company, which is one of its main clinker producing facilities."
The working of Chanderia unit in Rajasthan has been hampered as the mining operations for limestone at the plant remained suspended since August 20, 2011 due to an order by the Jodhpur High Court, the company said.
It added that as per the directions of the High Court, Indian Bureau of Mines (IBM) has conducted inspection and various tests with regard to the mining activities and its effect on Chittorgarh Fort and submitted a report.
The company further said that it lifted 2,55,000 tonnes of limestone excavated before the court-imposed ban and during the tests carried out by the IBM as it was granted a partial relief by the High Court to lift limestone.
The matter is expected to be heard shortly, Birla Corporation said.
Giving its outlook for the current fiscal, the company said that demand has seen a revival since January and the momentum is expected to continue, although cost pressures continues to be a matter of concern.
Shares of the company closed today at Rs 255.20 apiece on the BSE, down 0.20% from the previous close.