SAIL FY11 net down 27% to Rs 4,938 cr

Costlier coking coal has hit the bottomline of Steel Authority of India (SAIL) as the state-owned firm today posted 27% dip in consolidated net profit at Rs 4,937.73 crore for 2010-11 financial year.

The company had posted a net profit of Rs 6,790.78 crore in the previous fiscal, SAIL said in a statement.

Raw material consumption of the company grew to Rs 20,069 crore during the year, up 27% over Rs 15,805 crore in 2009-10 mainly on account of exuberant price of coking coal, which climbed up to $330 a tonne in the first week of March.

The raw material prices were up last fiscal on account of short-supply from the Quuensland province of Australia, the world's largest exporter in both coking coal and iron ore.

SAIL, however, meets its entire iron ore requirement from captive sources. It requires around 15 million tonne coking coal a year. Only 4.5 million tonne is met through domestic sources and the remaining 10.5 million comes from imports, around 60% of which comes from Australia.

Income from operations of the company during the year stood at Rs 47,103.09 crore compared to Rs 43,993.09 crore in 2009-10.

A significant rise in the employees' cost also impacted SAIL's net profit. Compared to Rs 3,518 crore expenditure on the account in previous fiscal, it went up to Rs 3,750 crore in last fiscal.