Hindalco logs Rs.321-cr profit in Q3 on better realisation

14 February 2017

The Hindu BusinessLine

Hindalco Industries, an Aditya Birla Group company, has reported net profit of Rs.321 crore in the December quarter against net loss of Rs.33 crore in the same period last year.

The sharp increase in aluminium realisation and tight control on expenses helped the company post a better performance, despite weak demand for copper and lower by-product realisations.

Revenue was up 14 per cent at Rs.9,915 crore (Rs.8,716 crore).

Earnings before interest, tax, depreciation and amortisation was up 64 per cent at Rs.1,405 crore largely due to better aluminium and copper prices, higher aluminium production and weaker rupee.

Satish Pai, Managing Director, told BusinessLine with demand for aluminium and copper remaining weak in domestic market due to demonetisation of high value currencies, the company increased the quantum of exports during the quarter to 51 per cent of overall sales against 45 per cent. “We sell more in the domestic market because the realisations are more as we get to capture the import duty of $80 a tonne," he said.

Aluminium revenue grew by nine per cent to Rs.4,917 crore, while EBITDA more than doubled to Rs.876 crore (Rs.354 crore).

The production increased by nine per cent to 3.20 lakh tonnes and sales grew 6 per cent to 3.10 lt. Cost of production reduced by eight per cent to $1,415 a tonne.

Copper sales were up 12 per cent at 97,000 tonnes.

Though copper LME prices were up nine per cent at $5,265 a tonne, treatment and refining charges were down seven per cent at 25.74 cents due to robust demand for concentrates in China.

While revenue from copper business was up 19 per cent at Rs.5,000 crore, EBITDA was down six per cent at Rs.330 crore due to lower price of by-products such as sulphuric acid and di-ammonium phosphate.

The cost of most inputs continued to remain benign, though prices of crude derivatives increased marginally with a rise in crude prices, said Hindalco.

The finance cost was up at Rs.588 crore (Rs.585 crore). The company has pre-paid debt of Rs.1,031 crore in the last three quarters of FY-17 and another Rs.342 crore of debt was paid back in January.

The company’s scrip was up 1.56 per cent at Rs.185 on Monday.