Hindalco Q1 net plunges 67% to Rs107 crore

Aditya Birla Group flagship company Hindalco has reported a 67 per cent year-on-year decline in its standalone net profit at Rs107.19 crore for the quarter ended 30 June, on the back of lower margins.

The company had reported a standalone net profit of Rs328 crore in the year-ago quarter and a net profit of Rs160 quarter in the previous quarter.

Revenue from operations for the April-June quarter of the current fiscal stood at Rs8,575 crore, up 7 per cent from Rs7,996 crore reported in Q1 of FY15, mainly due to higher volume despite lower commodity prices.

Profit before interest, tax, depreciation and amortisation (PBITDA) also rose by 11 per cent year-on-year to Rs1,072 crore from Rs965 crore.

Other income was lower at Rs194crore against Rs216 crore in the year-ago quarter and Rs230 crore in the previous quarter.

Hindalco said depreciation and finance costs were higher, given the additional capitalisation at both the greenfield smelter complexes.

Compared to Q4 FY15, revenue from operations was lower by 8 per cent mainly on account of lower metal realisation from a sharp drop in commodity prices. However, PBITDA has been maintained at Q4 FY15 level.

Hindalco noted that the LME price of aluminium, including premium (in rupee terms), had been lower by over 5 per cent vis--vis Q1 FY15.

Aluminium business contributed Rs3,966 crore to the revenue in Q1 FY16 against. Rs3,011 crore in Q1 FY15 supported by higher volumes.

The segment results of aluminium business fell from Rs320 crore to Rs254 crore despite higher volumes, mainly because of lower realisation and the provision for renewable energy obligation.

In the copper business, Hindalco said, revenue declined to Rs4,614 crore in Q1 FY16 from Rs4,990 crore (Q1 FY15) mainly due to 11 per cent lower copper LME.

The segment results stood at Rs344 crore in the June FY16 quarter against Rs317 crore in the previous-year quarter as operational performance improved, coupled with better TcRc and acid realisation.

Alumina production (including Utkal refinery) stood at 592,000 tonnes against 428,000 tonnes in Q1 FY15 and 515,000 tonnes in Q4 FY15. Hindalco said its published financials do not include Utkal performance.

Metal production increased to 264,000 tonnes from 190,000 tonnes in Q1 FY15 and 242,000 tonnes in Q4 FY15, consequent to the ongoing ramp-up at Mahan smelter and Aditya smelter.

Copper cathode production stood at 102,000 tonnes against 96,000 tonnes in the previous-year quarter and 100,000 tonnes in Q4 FY15.

Going forward, the operational performance is expected to be robust with the ramp-up of new facilities. Adverse metal realisation may pose a significant turbulence in the near term, Hindalco stated.