The unaudited financial results released after the company's board meeting held here on Monday also showed a 20 per cent growth in sales to Rs 773.95 crore from Rs 641.95 crore posted in the previous corresponding period.

Operating profit for the third quarter ended December 1998 stood at Rs 57.19 crore, up from Rs 55.55 crore in the previous corresponding quarter.

However, despite sales improving by 20 per cent, the company has been unable to translate this into profits on account of higher operating costs which have resulted in the operating margins declining from 8.65 per cent in the third quarter of 1997-98 to 7.38 per cent in the third quarter of the current fiscal. Gross profit too hasdeclined to Rs 22.46 crore from Rs 23.21 crore.

The company has shown an increase of around Rs 2 crore in interest charges to Rs 34.74 crore from Rs 32.29 crore. Also, depreciation charges have come down by some Rs 2 crore to Rs 12.16 crore from Rs 14.28 crore.

No provision has been made for taxation but this is expected to be considered at the end of the year. Claims of the company with the Government of India for escalation in inputs and other costs for the manufacture and import of fertilisers are being considered by the government, it is learnt.