Mumbai: Raymond has announced moderate profits for the first quarter ended June 30, 2004. The profit before tax (PBT) for the first quarter was Rs5.14 crore against Rs26.42 crore for the same quarter of the previous year. The net profit after tax (PAT) for the first quarter was at Rs3.14 crore (Rs20.92 crore) after providing for taxes worth Rs2 crore (Rs5.50 crore). The gross sales were higher at Rs199.65 crore (Rs185.50 crore) despite the continued recession in the market.

The reduction of profit has been impacted due to the depreciating rupee resulting in a loss of foreign exchange worth Rs9.82 crore (gain of Rs3.52 crore), higher interest charges of Rs4.88 crore (net interest income of Rs2.68 crore) and higher raw material costs. However, the company is confident of achieving planned performance for the year 2004-05.

The company''s textile division maintained revenue in value at Rs107.77 crore (Rs107.53 crore) and in volumes at 38.7 lakh metres (40.3 lakh metres), despite a marginal drop in domestic demand. The profitability of the division has been affected by an increase in the cost of raw material. Sales of the division, which contribute substantially to the company''s total sales and profitability, are seasonal and the bulk of dispatches of high value fabric take place in the latter part of the year.

Raymond''s denim division has recorded a marginal increase in revenue in value at Rs47.46 crore (Rs40.28 crore) and in volumes at 43.4 lakh metres (39.6 lakh metres). The performance of the division was affected due to a steep increase in cotton prices.

The files division has recorded sales of Rs33.13 crore (Rs26.34 crore), but the performance of the division was adversely affected by a steep increase in the cost of steel, its main raw material.

The board has approved a proposal to set-up an additional trouser line at the existing manufacturing facility at Bangalore. The line will be from its wholly owned subsidiary Silver Spark Apparel, with a capacity of 1,000 trousers per day and will commence operations from November 2004.

The board has also approved a proposal to set-up a new facility in Bangalore for the manufacture of formal shirts, with a capacity of 3,000 shirts per day, at a total project cost of Rs13.57 crore. The project will be implemented through a new company to be formed, and will commence operations from March 2005.