Thermax Net Dips 4.63 Per Cent To Rs 43.16 Crore
Thermax Ltd has posted disappointing results in 1996-97 with net profit dropping 4.63 per cent to Rs 43.16 crore from Rs 45.16 crore in the previous year.
The new profit would have been much lower if not for higher other income of Rs 7.61 crore (Rs 6.02 crore) and a whopping Rs 5.82 crore extra-ordinary income (nil).
The extra-ordinary income is on account of surplus on transfer of business and compensation for non-compete convenant. Besides, the company has provided Rs 10 crore for taxation as against Rs 12.30 crore in the previous year.
Also Read
As the board of directors has decided to postpone the announcement of the dividend, provision for tax on the same has not been made in the companys unaudited results. The board plans to announce the dividend at the time of finalisation of the audited results. The tax outgo will further squeeze the net profit.
However, the unaudited net profit is higher than the Rs 38.60 crore projected by the company at the time of going public. Following the reduced profits, the earning per share (EPS) of the company has dropped from Rs 19.64 to Rs 18.56 in 1996-97.
The companys gross profits dropped by 2.92 per cent to Rs 62.13 crore (Rs 63.95 crore).
Total expenditure of the company went up by 12.77 per cent to Rs 451.83 crore (Rs 400.66 crore). Interest cost went up sharply from Rs 5.82 crore to Rs 8.49 crore, an increase of 45.87 per cent. Provisions for depreciation were higher at Rs 8.97 crore (Rs 6.49 crore). Abhay Nalawade, managing director, Thermax, attributed the subdued market conditions, liquidity crunch faced by its clients and the truckers strike during year for the poor performance of the company.
This year, Nalawade said, the company will focus more on improving the market share to counter the slower industry growth. Measures to control costs being contemplated are inventory control, cost control and improvement in productivity.
Though the total income of Thermax was higher by 11.05 per cent at Rs 509.02 crore in 1996-97 compared with the previous year, it was 8.75 per cent lower than the projected turnover of Rs 568.20 crore.
Reserves of the company, which went up from Rs 223.50 crore to Rs 266.66 crore in 1996-97, are expected to fall depending on the amount of dividend being announced by the company.
Exports grew by only 14 per cent to Rs 80.94 crore as against a 69 per cent growth to Rs 71 crore recorded previous year.
The company has not fully utilised the proceeds of the Rs 23.35 crore public issue in February 1995 towards modernisation of existing manufacturing facilities.