New Delhi: JK Lakshmi Cement on Friday, reported 89 percent fall in standalone net profit at Rs 6.05 crore for the quarter ended March 31, 2015 hit by one-time cost for sales tax exemption as well as marketing expenses.
The company had posted a net profit of Rs 52.91 crore in the year-ago period, it said in a BSE filing.
Total standalone income of the company declined by 11 percent to Rs 578.15 crore in January-March of last fiscal from Rs 648.23 crore in the same quarter of 2013-14 on account of fall in demand mainly due to unseasonal rains.
"January-March quarter usually is a good period, but this time there was low demand. The growth has been negative both on all India by 1 percent and in our marketing zone by nearly 6 percent impacting the company," JK Lakshmi
Cement's whole time Director Shailendra Chouksey told PTI.
The firm also suffered relatively higher because of its rural focus. This year due to unseasonal rainfall in this quarter and the consequent crops damage, the rural consumption has been very adversely affected, he added.
On the steep fall in net profit, he said: "There was a Rs 31.75 crore exceptional item for Sales Tax exemption and one time expenditure on the launch of a product in Eastern markets as well as some unaccepted insurance claim, which impacted net profit in the fourth quarter."
JK Lakshmi Cement's realisation was also impacted as the fall in demand lead to cement surplus in the market resulting in softening of prices.
Besides, increase in costs on account of higher royalty on limestone, electricity duty imposed by the state government in their respective budgets and also increase in the freight cost on account of increase in the railway freight impacted the balance sheets.
For the entire 2014-15, the firm's standalone net profit rose 3 percent to Rs 95.6 crore from Rs 93 crore in 2013-14.
Total standalone income grew 12 percent to Rs 2,307.06 crore from Rs 2,056.6 crore during the same period.
Chouksey said the firm in fourth quarter commissioned 1.7 million tonnes of cement out of its capacity of 2.7 million tonne at the greenfield project in Durg (Chattisgarh).
Besides, the increase in royalty on limestone and higher fuel prices, the firm was able to contain its variable cost with a marginal increase of about 1.5 percent, he added.
"There was improvement in coal consumption that was at 704 K.Cal/Kg of clinker in FY'15 from 726 K.Cal/Kg of clinker in FY 2013-14. We also enhanced WHR generation from 6.86 crore units in 2013-14 to 9.06 crore in 2014-15," he said.
Going ahead, Chouksey said the firm is optimistic that with the government's emphasis on roads, infrastructure and housing, considerable demand will build up in the market in the near future, which will help the company shore up its top and bottom line.
Shares of the company today rose by 0.22 percent to settle Rs 343.15 per share on the BSE.
