Tata Power Q3 net up 26%

Tata Power Company has posted a 26.39 per cent rise in the net profit for the third quarter ended December 31, 2003, despite net sales falling by 10.49 per cent.

The board of directors also decided on Tuesday to hive off the broadband business of the company into a wholly owned subsidiary.

Tata Power's net profit for the quarter rose to Rs 184.49 crore against Rs 145.97 crore for the corresponding period of the previous year. The company's net sales for the quarter stood at Rs 1,027.45 crore against Rs 1,147.91 crore for the corresponding quarter of the previous year.

A senior Tata Power executive said net sales decreased since the fuel costs had been brought down and this in turn had been passed on to the customers.

"Tata Power's management has laid emphasis on improving profitability and enhancing shareholder value through a combination of increased focus on new business areas and greater thrust on reducing per-unit power cost. Over the last two quarters, the management has seized the opportunity offered within the ambit of the Electricity Act to lay a strong future growth plan," Tata Power managing director Firdose A Vandrevala said.

The company's total expenditure declined by 14.95 per cent for the quarter to Rs 704.81 crore against Rs 828.78 crore. The reduction in expenditure was mainly on account of two heads "" fuel costs and interest charges. The company saved Rs 65.55 crore by changing the fuel mix ratio and heat rate improvement.

Further, the interest and finance charges declined by 32.53 per cent to Rs 57.02 crore against Rs 84.51 crore. This was because the company pre paid loans to the extent of Rs 319 crore in the third quarter of the current fiscal year.

For the nine-month period ended December 31, 2003, the company repaid loans to the tune of Rs 428 crore.

The company's net profits for the nine-month period rose by 24.66 per cent to Rs 454.73 crore against Rs 364.65 crore. Net sales for the nine-month period stood at Rs 3,138.49 crore against Rs 3,390.44 crore.