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Despite higher production, Holcim Group companies ACC and Ambuja Cements have reported a dip in their net profit during the March quarter of 2011 largely due to escalating input cost.
ACC's sales rose by 10 per cent to 6.16 million tonnes (5.58 mt) and Ambuja Cements' by seven per cent at 5.64 mt (5.28 mt). ACC has reported that its consolidated net profit was down 11 per cent at Rs 350 crore (Rs 393 crore), while Ambuja Cements' bottomline was lower by 12 per cent at Rs 407 crore (Rs 462 crore) in the quarter under review.
ACC's sales increased 14 per cent to Rs 2,556 crore (Rs 2,240 crore) in the March quarter.
The company's expenditure jumped 23 per cent to Rs 2,119 crore (Rs 1,724 crore) largely due to higher costs for power and fuel, freight and employee expenses. Outward freight charges were up 25 per cent at Rs 343 crore (Rs 274 crore), power and fuel bill rose 22 per cent to Rs 483 crore (Rs 395 crore) and employees cost was 24 per cent at Rs 122 crore (Rs 98 crore).
Manufacturing costs rose sharply as a result of increases in the cost of energy, fuel and raw materials such as fly ash and slag, ACC said. Coal was dearer both in the domestic and international markets and transport costs also suffered due to inflation, it added.
Ambuja Cements' expenditure rose 18 per cent to Rs 1,702 crore (Rs 1,444 crore). With the capex initiative taken in the previous year, there was an overall efficiency improvement in substituting own clinker with purchased clinker, the company said. Improvement in thermal, electrical and logistic efficiency and gain in power generation also helped to lower the impact of cost escalation, it added.
Power and fuel cost was up 36 per cent at Rs 482 crore (Rs 355 crore), raw material expenses moved up 32 per cent to Rs 141 crore (Rs 107 crore) and freight and forward cost was up 24 per cent at Rs 509 crore (Rs 412 crore). The company has realised Rs 15 crore (Rs 29 crore) from sale of surplus power in the quarter under review.
ACC and Ambuja Cements' shares on BSE were up one per cent each to Rs 1,123 and Rs 157 respectively on Tuesday.
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