Indo Rama Synthetics Q2 net loss at Rs 61 cr

Polyester maker Indo Rama Synthetics (India) Ltd today reported a net loss after tax of Rs 61.36 crore for the second quarter ended September 2013.

The company had posted a net profit of Rs 103.59 crore in the year-ago period.

For the July-September 2013 quarter, net sales stood at Rs 619.98 crore as against Rs 734.50 crore in the same quarter of 2012-13. Operational EBITDA declined to Rs 15.55 crore as compared to Rs 41.26 crore in the same period last year, a company statement said.

"The sales in the quarter have been lower due to weak demand in the local as well as international markets. Adding to the weak demand, the production was also hampered due to the lack of adequate raw material, which was affected due to the sudden stoppage of production at the PTA plant of IOCL at Panipat.

"Combination of these factors has adversely affected the margins in the quarter," the release said.

For the half year ended September 30, 2013, the company delivered a net sales performance of Rs 1,326.24 crore, as compared to Rs 1,488.63 crore in H1 of previous year. Operational EBIDTA stood at Rs 29.95 crore as compared to Rs 27.69 crore last year. The loss after tax was Rs 91.39 crore as compared to profit of Rs 77.49 crore in H1 of previous year.

Commenting on the company's performance, its Chairman and Managing Director O P Lohia said, "Our performance for this quarter has been delivered in the face of a continuing difficult macro environment. Demand has decreased significantly resulting in lower off take. The volatility of Indian currency has also increased the cost of our imported inputs and resulted in forex loss."

"We are, however, now witnessing a gradual improvement as we expect the demand to be on the higher side. We also continue to enhance our focus on the international markets. This not only contributes to increased volumes; it also acts as a hedge against high input import costs.

"Stable crude prices combined with a strong cost rationalisation will also help us to improve operational performance in the second half of the year," Lohia said.