ACC in red, posts Rs 9.5 cr loss in Q1

ACC in red, posts Rs 9.5 cr loss in Q1
ENS ECONOMIC BUREAU

MUMBAI, JULY 31: Despite a sharp rise in volumes, the Associated Cement Companies (ACC) has slipped deep into the red with a loss of Rs 9.50 crore for the first quarter ended June 30, 2000, against a profit of Rs 7.02 crore during the same period last year.

Net sales rose to Rs 765.37 crore from Rs 701.10 crore, while other income increased from Rs 6.30 crore to Rs 8.10 crore during the period. Sales volume (including traded cement) shot up to 3.04 million tonnes from 2.70 million tonnes.

Cash profit during the first quarter stood at Rs 25.26 crore, as against Rs 35.22 crore last year, while operating profit slipped from Rs 75.33 crore to Rs 66.64 crore during the period.

"There has been a decline in price realisation by about 5 per cent compared to the corresponding period of the previous year, which has adversely affected the operating profit margins," ACC managing director TMM Nambiar has said.

During the first quarter, ACC's interest charges inched up from Rs 40.11 crore to Rs 41.38 crore, while provision for depreciation rose sharply to Rs 34.76 crore from Rs 27.28 crore last year.

The higher depreciation is largely due to the commissioning of various projects including captive power units. The company has completed its expansion projects at Chanda and Madukkarai. "The two million tonne Wadi plant is under implementation and is progressing as per plans," ACC has said.

The company has said that it has been able to reduce its overall production cost during the first quarter despite the inflationary impact on input prices. "These improvements have contributed to a significant reduction in losses for the quarter ended June 30, 2000, as compared to the immediately preceding quarter," the company said.

"In view of the success being achieved in the management of costs coupled with evident signs of improvements of market conditions due to cement supply-demand moving closer to equilibrium, the performance of the company is expected to improve," ACC has said.