JSPL Q1 loss at Rs 339cr, lower realisation drags revenue

Consolidated crude steel production stood at 1.1 million tonne in Q1, a 37 percent growth over corresponding quarter of last fiscal due to enhanced capacity utilisation of Angul and Oman steel plants. Steel sales increased by 39 percent to 1.1 million tonne in Q1.

JSPL said iron & steel business dropped 3 percent year-on-year to Rs 3,724 crore with EBIT (earnings before interest and tax) down 69 percent and margin decline of 1200 basis points in June quarter. However, power revenue increased 3 percent to Rs 1,263 crore with EBIT falling 38 percent and margin contraction of 2000 basis points year-on-year, it added.

Operating profit fell 37 percent year-on-year to Rs 989 crore and margin contracted by 1100 basis points to 21 percent in first quarter of FY16.

Power and fuel cost shot up 75 percent to Rs 804 crore during the quarter compared to Rs 460 crore in the same quarter last year.

Finance cost during the quarter climbed 59 percent year-on-year to Rs 851.6 crore while the steel maker has a tax write-back of Rs 150 crore against tax expenses of Rs 115 crore during the same period.

Jindal Power's Q1 profit dropped 87 percent year-on-year to Rs 26 crore and revenue declined 13 percent to Rs 610 crore. Lack of captive coal (as coal mines were deallocated on March 31) and lower merchant prices impacted plant load factor (PLF), company said.

"However, coal availability through e-auction has now improved and Jindal Power is able to procure coal at competitive prices. This should help in progressive improvement in PLFs in FY16," it added.

Operating profit slipped 56 percent year-on-year to Rs 170 crore due to lower utilisation of plant and higher coal costs. Margin contracted by 2700 basis points to 28 percent in June quarter.

Shares of Jindal Steel (which announced earnings post market hours) closed at at Rs 77, down Rs 4.55, or 5.58 percent on the Bombay Stock Exchange.Posted by Sunil Shankar Matkar