Sterlite Industries, a Vedanta Group company, on Monday reported a growth of 50% in its consolidated net profit to Rs 1,008 crore for the first quarter ended June 30, 2010 against Rs 673 crore in the corresponding quarter last year. The company’s consolidated net sales during the quarter stood at Rs 5,925 crore, up 29%, as compared to Rs 4,580 crore in Q1 FY 2009.
However, according to industry analysts, the results are below expectations as the company’s profit after tax (PAT) was expected to be around Rs 1,200 crore. Sterlite Industries shares on Monday closed marginally up by 0.20% at Rs 174.15 on the Bombay Stock Exchange.
The company’s revenues from its aluminum business during the first quarter stood at Rs 666 crore, an increase of just 4%, whereas, Ebitda declined to Rs 98 crore compared with Rs 133 crore in the corresponding quarter of the previous year. ?The decrease in profitability in the aluminium business was primarily due to higher alumina cost, power costs, additional gratuity provision pursuant to enhancement of gratuity ceiling under Payment of Gratuity Act and unabsorbed costs of Balco plant I,? the company said in a statement.
Vedanta Resources executive vice-chairman Navin Agarwal said, ?We believe that we are uniquely placed among the global mining assets.?
?This is on the back of strong assets portfolio, low cost of production and an organic growth pipeline. Moreover, we continue to evaluate growth opportunities both organically and inorganically going ahead,” he said during the conferance call.
Experts say the power business which sold 480 million units of power against 287 million units in Q1 FY09 helped the company. Revenue (net of transmission and wheeling charges and inter segment transfers) stood at Rs 239 crore compared with Rs 155 crore in the corresponding prior quarter with an Ebidta growth of 36%. Sterlite has consolidated cash, cash equivalents and liquid investments of Rs 24,874 crore as on June 30, 2010, it said.
Its production from Balco dropped by 12% to 63,000 tonne from 72,000 tonne in Q1 FY10. During Q1, Sterlite produced 1,82,000 tonne of mined metal and 1,65,000 tonne of refined zinc resulting in 29% revenue increase from the business during the first quarter.
Its copper cathode production at the Tuticorin smelter during the quarter at 77,000 tonnes was lower due to planned maintenance shutdown for 22 days beginning 22 June 2010, the company said. Revenues for Q1 were Rs 3,092 crore, an increase of 35% along with 125% growth in Ebitda to Rs 261 crore.