Hindalco Q1 net plunges 67%; expects 'significant turbulence'

Aluminium maker Hindalco today reported a steep 67 per cent drop in standalone net profit at Rs 107.19 crore for the quarter ended June 30, due to lower realisation.
The flagship firm of the Aditya Birla Group had clocked a net profit of Rs 327.50 crore in the year-ago period, it said in a BSE filing.
Standalone revenue of the company was up 7 per cent to Rs 8,575.27 crore in April-June quarter of this fiscal from Rs 7,996.14 crore in the same quarter of 2014-15.
The company's total expenses rose by 8 per cent to Rs 8,029.92 crore from Rs 7,434.79 crore in the reported quarter.

On outlook, the company said: "Going forward, the operational performance is expected to be robust with the ramp-up of new facilities. Adverse metal realisation may pose a significant turbulence in the near-term."
Shares of the company in the morning trade touched a 52-week low of Rs 89.55 apiece, but by afternoon they were trading 3.14 per cent higher at Rs 93.75 per share.

Better revenue was "mainly on the back of higher volume despite lower commodity prices," Hindalco said in the filing.
"Depreciation and finance costs are higher, given the additional capitalisation at both the greenfield smelter complexes," it added.

In the June quarter, Hindalco's depreciation costs shot up to Rs 332 crore as against Rs 187 crore in the year-ago period, finance costs rose to Rs 602 crore from Rs 338 crore during the same period.
Sequentially, the company's revenue fell by 8 per cent from Rs 9,372 crore in January-March of 2014-15 "mainly on account of lower metal realisation from a sharp drop in commodity prices," it said.
Aluminium business' contribution was higher at Rs 3,966 crore to the revenue in the June quarter this fiscal from Rs 3,011 crore in Q1 2014-15 helped by higher sales, Hindalco said.

"The segment results of Aluminium business fell from Rs 320 crore to Rs 254 crore despite higher volumes mainly because of lower realisation and the provision of Renewable Energy Obligation," it added.
Revenue from copper business declined from Rs 4,990 crore in June quarter of last fiscal to Rs 4,614 crore in the same quarter of 2015-16 fiscal "mainly due to 11 per cent lower copper London Metal Exchange (LME)" prices, it said.
"The segment results stood at Rs 344 crore vs Rs 317 crore in the current quarter as operational performance improved, coupled with better treatment and refining charges (TcRc) and acid realisation," Hindalco added.

Total Alumina production stood at 592 kilotonnes (KT) in the June quarter against 428 KT in the year-ago period. Metal output during the reported quarter stood at 264 KT against 190 KT on account of ramp up at Mahan and Aditya smelters.
Total Cathode (copper) output was 102 KT in April-June this fiscal from 96 KT in the same quarter of 2014-15.