Other income boosts Godavari Fertilisers'' profit. Breaks dividend drought

Chennai: A profit of almost Rs7 crore on sale of assets has boosted Godavari Fertilisers and Chemicals Limited's net profit to Rs17.09 crore for the fiscal ended 31st March 2005. The company's board has proposed a 10 per cent dividend, breaking the dividend drought for the shareholders. Last fiscal the company had posted a net profit of Rs7.15 crore.

Part of the Murugappa group, Godavari Fertilisers closed FY 2005 with a turnover of Rs1,200.05 crore an other income of Rs11.41 crore as against Rs897.08 crore and Rs6.42 crore respectively earned the previous year.

During FY 2005 the company reduced its interest expenditure by 11 per cent to Rs16.86 crore. Profit before tax during year has increased to Rs25.92 crore from Rs10.28 crore. The company also implemented a voluntary retirement scheme for its employees resulting in a payout of Rs3.68 crore.

According to the company the year that went by had several challenges in relation to under recovery of costs incurred on account of raw material, freight, energy, packaging and statutory levies due to the policy of the government in not providing adequate support in the form of concession to compensate the increase in costs. The retail prices were not allowed to be increased for the last few years.

Despite the challenges, the company improved its performance by achieving higher production and sales, product mix improvement and tough credit control measures. The total production increased by 10 per cent to 8.88 lakh tonne as compared 8.06 lakh tonne in the previous year despite intermittent stoppages due to raw material unavailability.