Coromandel reports 88.5% dip in net profit

Coromandel International Limited (CIL), a manufacturer of  fertilisers and crop protection products, reported 88.5% decline in net profit at Rs 14 crore in the fourth quarter of 2012-13 compared to a profit of Rs 122 crore posted in the same quarter previous year.

The company's turnover during the period declined by 27% to Rs 1,948 crore from Rs 2,672 crore.

In the year ended March 2013, the company's net profit stood at Rs 444 crore, down 36% over the previous year's profit of Rs 693 crore. Turnover during the year was lower by 13% at Rs 8,560 crore (previous year Rs 9,823 crore).

"Deficit monsoon in the key addressable markets during the year and growing price disparity between urea and phosphate prices impacted the demand for phosphatic and potassic fertilisers",  CIL managing director, Kapil Mehan, stated while commenting on the financial results.

Despite the adverse conditions,  the company had improved its market share in the home state of Andhra Pradesh (AP) while maintaining the market share in overall domestic market.

"With monsoon expected to be normal in the forthcoming Kharif season, we expect high pipeline inventories of all agricultural inputs to normalise", Mehan said.

During the quarter under consideration, CIL has commissioned its third complex fertiliser plant at Kakinada besides entering into a share purchase agreement to acquire 8.13% stake in AP Gas Power Corporation Limited.

The company had also acquired 48.62 stake in Liberty Phosphate Limited (LPL) and made a public announcement to acquire an additional 26% equity share capital of LPL.

CIL, along with LPL, currently has 5 million tonnes  per annum capacity to manufacture complex fertiliser and single super phosphate.  With a network of 640 retail centres across AP and Karnataka, Mehan said that the company's retail business had also turned cash positive.