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Hindalco Q1 net down 34%

Press Trust Of India  |  New Delhi 

flagship firm on Tuesday reported Rs 425 crore in standalone net profit for the April-June quarter, down 34 per cent over the corresponding quarter a year ago, on higher operational expenses.

The company, which mainly produces aluminium and copper, had reported Rs 644 crore net profit during the April-June quarter of the last financial year, it said in a release.

Surge in input costs, mainly in coal, caustic soda and carbon products affected earnings by nearly Rs 200 crore during the reporting quarter, it added.

Revenues, however, remained almost static at Rs 6,028 crore, compared to Rs 6,031 crore a year ago as both aluminium and copper production dipped to 132,000 tonnes and 69,000 tonnes from 140,000 tonnes and 73,000 tonnes, respectively.

“Operational were impacted due to the planned shutdown of the copper production facility and lower volume due to certain operational disturbances in the aluminium plants. These have since been taken care of and currently the operations are under full ramp-up,” Hindalco said.

The company’s aluminium business contributed Rs 2,063 crore to the total revenues compared to Rs 2,093 crore a year earlier.

“The benefits of improved mix and mark-up were nullified by macroeconomic factors, lower overall volume, realisation and higher input costs,” it added.

Revenues were maintained in the copper business at Rs 3,972 crore compared to Rs 3,940 crore in the first quarter of the last fiscal.

Total expenses of the company, however, rose to Rs 5,735 crore during the quarter vis-a-vis Rs 5,340 crore a year ago mainly due to higher power and fuel costs. Finance costs also rose as a of “hardening of interest rates”.

Going forward, input cost surge and volatile commodity prices would pose significant challenges, Hindalco said.

“However, the company is confident of sustaining its performance given the wide downstream presence and the emphasis on operational efficiencies and cost control,” it added.

First Published: Wed, August 15 2012. 00:22 IST