Hindalco dives into red, posts Q1 consolidated pre-tax loss of Rs 600 cr

Hindalco Industries posted a consolidated pre-tax loss of Rs 600 crore in the June quarter compared to a profit before tax of Rs 1,556 crore in the same period last year on lower revenue and exceptional expenses incurred amid the pandemic.

The company’s consolidated net sales in the quarter gone by stood at Rs 25,283 crore, down 15.6 per cent from same period last year. This is due to the coronavirus outbreak, which shut smelters in the beginning of the quarter with realisation also taking a hit due to weak demand. Earlier, Novelis had to temporarily shut down some of its facilities to align with customer demand and reduce operating costs. However, as many customers resumed production in May, Novelis was able to ramp up output to meet increasing order levels. 

Today, all of its plants are operational and many are running at almost full capacity, said a company release.

In the period under review, the Aditya Birla Group firm incurred an exceptional expense worth Rs 419 crore comprising donations made towards pandemic relief measures and Covid-19 bonus to employees. Without the exceptional items, the company’s pre-tax loss stands at Rs 184 crore in the June quarter against a profit of Rs 1,577 crore in the same period last year. Hindalco reported a consolidated net loss of Rs 709 crore in the period under review as losses widened due to discontinued operations of Aleris’ automotive plants in Duffel and Lewisport. 

This also nullified the gain from deferred tax benefit worth Rs 325 crore in the period under review.