Companies

Q2 results: India Cements posts Rs 9 crore profit after tax amid sales drop

Our Bureau Chennai | Updated on November 11, 2019

N Srinivasan, Vice-Chairman and MD, India Cements Ltd (file photo)

Total expenses stood at Rs 1,271.02 crore during the quarter

The India Cements Ltd on Monday said it has posted a consolidated net profit of Rs 5.07 crore for the second quarter ended September 30, 2019. The company had posted a net loss of Rs 5.03 crore for July-September a year ago, India Cements said.

Declaring the results, Vice-Chairman and Managing Director N Srinivasan said the company reported a marginal improvement in its operating performance for the quarter under review despite drop in cement volume through improved realisation and reduction in cost as compared to same quarter the previous year.

According to him, the company supplies 31 lakh tonne to Andhra Pradesh and Telangana but it dropped to 12-13 lakh tonne following the fall in demand. Revenue from operations was down 11.20 per cent to Rs 1,269.40 crore during the quarter under review as against Rs 1,429.57 crore in the year-ago period.

Total expenses stood at Rs 1,271.02 crore during the quarter as against Rs 1,439.27 crore in the same period a year ago. Srinivasan said the cement industry has witnessed negative growth of 5 per cent in August and two per cent in September over the same period the previous year.

“The steep fall in demand in Andhra Pradesh and Telangana accounted for a major portion of the shortfall in the demand in the South,” he said. In terms of growth, cement industry witnessed an increase in production in North, West and Central while in South it has declined by over 10 per cent during the quarter ending September 30, 2019, he said.

On the company’s proposal to set up new manufacturing unit in Madhya Pradesh, he said the company was in the process of completing the purchase of land. India Cements has planned to set up a manufacturing unit in Madhya Pradesh at an investment of around Rs 1,000 crore following an agreement it signed to acquire Springway Mining Pvt Ltd.

Srinivasan said the company would also also look at skilling people and engaging contract labour. According to him, the company has permanent employee base of 2,148 and it would come down by focusing on multi-skilling people and engaging contract labour.

“It may come down to 700-800. We are working on multi- skilling people”, he said. Srinivasan expressed hope that fourth quarter of current financial year would be better and with normal monsoon predicted, the demand season would pick up.

The capacity utilisation of the company’s units during the quarter under review was 68 per cent as against 77 per cent during the same quarter the previous year. The overall cement and clinker volume was at 26.67 lakh tonnes for the quarter as compared to 30.77 lakh tonne in same quarter last year.

Published on November 11, 2019

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