The Hindu Business Line : ACC net rises 72% in Q1; capex at Rs 600 cr<br>Accounting year to be Jan-Dec

ASSOCIATED Cement Companies (ACC) has reported a 72 per cent increase in net profit for the first quarter of the current year, helped by increased sales and higher operating efficiency.

Net profit for the quarter amounted to Rs 139.36 crore, whereas net profit for the corresponding quarter of the previous year had been Rs 81.23 crore.

Volume sales of cement for the quarter at 4.41 million tonnes showed a 13 per cent increase over the year-ago sales of 3.89 mt. Sales turnover increased by 19 per cent, and was recorded at Rs 1,128.25 crore (Rs 947.93 crore).

Profit before interest, depreciation, exceptional items and tax, at Rs 254.81 crore (Rs 176.65 crore) rose 44 per cent.

Net interest costs rose 5 per cent to touch Rs 21.92 crore; depreciation too was higher at Rs 47.98 crore (Rs 43.91 crore). Both items were higher on account of acquisition of the Wadi captive power plant, the commissioning of the Chaibasa power plant and expansion of unit one of the company's Gagal plant.

The company's board of directors has decided to change the company's financial year, which will now start on January 1 and end on December 31. This is to align ACC's operations with that of Holcim, the Swiss major which, along with Gujarat Ambuja Cements, holds over 34 per cent stake in ACC. The current financial year will be for a period of nine months (from April 1, 2005 to December 31, 2005).

The cement industry recorded a growth rate of around 11 per cent for the quarter now ended compared to 2.7 per cent for the corresponding year-ago quarter. The projected demand growth of 8 per cent with no new significant capacity addition in the pipeline should lead to stable-to-improved cement prices, said a statement from the company.

New projetcs: The company's capital expenditure for the current year for new projects and expansions is Rs 600 crore, said Mr Tarun Das, Chairman of ACC, at the company's AGM here on Wednesday.

The projects include a 15-MW captive power plant at Chaibasa and augmenting of capacity at Gagal Unit I was commissioned with effect from April 1 and May 3, respectively. The modernisation project at Chaibasa and augmentation of capacity at Gagal Unit II are expected to be completed shortly. The project at Lakheri for expansion of capacity and 25 MW captive power plant has also been taken in hand.

The expansions and de-bottlenecking will bring up the company's capacity to 20.6 mt.

Mr Markus Ackermann, ACC Director and appointee from Holcim, would not respond to questions on whether Holcim has immediate plans to increase its stake in ACC.

Mr Ackermann and Mr Hugentobler are the Swiss appointees on ACC's board.

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