State-owned NALCO (National Aluminium Company) is expected to report a profit after tax of Rs 120 crore for the fourth quarter of FY12, down 61% as compared to Rs 305.3 crore in a year ago period, according to CNBC-TV18 poll.
Net sales are seen going down 6% at Rs 1,674.5 crore from Rs 1,787.5 crore year-on-year.
EBITDA too is seen falling 59% year-on-year to Rs 172.1 crore for the January-March quarter of 2012. EBITDA margin is expected to fall at 10.3% versus 23.3% during the same period.
On quarter-on-quarter basis, profit after tax of the company is likely to jump 2.3 times and EBITDA 3.8 times for the quarter ended March 2012. Net sales are seen going up by 17%.
In Q3FY12, NALCO delivered a poor set of results:
EBIT was negative as 120 pots out of 960 remained closed during 3QFY12 (were closed for some part of Q4FY12)
Also higher employee costs which included a one-off amounting to Rs 30 crore w.r.t. one time pay hike to the non-executive staff
Non-availability of coal from Coal India has added to their woes (In Q3FY12, it used 10% imported coal and 15% e-auction coal):
But in Q4FY12 have been getting consistent and good supply of coal from Coal India
Production Boast in Q4FY12 on a QoQ but lower on a YoY basis due to lower coal availability:
Management had expected alumina production of 100,000 tonne from its new refinery during 4QFY12 which seems impossible
However, aluminum LME prices have increased 4% QoQ but down 12% YoY but will be supported by 10% rupee depreciation
Alumina volumes likely to to increase 10-12% QoQ and Al volumes to increase 8%QoQ in Q4FY12
EBITDA margins to increase QoQ (as stable costs compared to 3QFY12) but huge contraction on a YoY basis:
Cost of production has continued to remain at elevated levels and profitability would remain under pressure due to high fuel costs
On a QoQ basis margins will be driven by higher metal prices and better volumes
Key positive trigger: Power cost to remain high till Utkal coal block commissioned:
Nalco has been suffering on account high power cost as it is unable to get sufficient coal through linkage from the Mahanadi Coal Field
Has been dependent on high cost e-auction and imported coal
Till the Utkal coal block is commissioned Nalco will not be able to reap the full benefits of its enhanced refining capacity and power capacity