Companies

CIL net up 4% at ₹3,004 cr

Our Bureau Kolkata | Updated on February 11, 2018 Published on February 11, 2018

No delivery Coal production has gone off track   -  REUTERS

Coal India on Saturday announced a four per cent increase in consolidated net profit to ₹3,004.79 crore in the December quarter as against ₹2,883 crore during the same period in 2016.

While the results are not comparable due to the introduction of GST and change in accounting principles, the company’s total income (net of taxes and including other income) increased by nearly ₹950 crore.

However, that was more than offset by the ₹522-crore rise in employee expenses (due to wage award to workers and ad-hoc provisioning for anticipated hike of officers’ salary) and significantly higher provisions for stock-in-trade, compared with last year.

A close scrutiny reveals that lower provisioning on account of anticipated ‘grade-slippage’ (supplying inferior quality fuel than promised) was a major attribute to profits. The miner provided ₹416 crore to mitigate anticipated outgo to consumers on account of grade slippage in the December 2016 quarter. This year, it expects to have supplied better quality fuel than promised, leading to an anticipated gain of ₹153 crore.

CIL sources describe it as a positive trend. “Expenses on account of grade slippage has been reducing over the last couple of quarters, indicating greater emphasis on customer service,” a company official told BusinessLine.

Published on February 11, 2018
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