Higher power purchase costs eats into profits at CESC

KOLKATA: CESC registered a marginal 1.6% growth in total comprehensive income under the new accounting standards – IndAs, for the first quarter of the current financial year against the previous corresponding period.

Comprehensive income is the sum of net income (net profit) and other items that must bypass the income statement because they have not been realized. According to the new accounting standard – IndAs, total comprehensive income is a better indication of the company’s profits rather than net profit.

Nevertheless, CESC’s net profit for the quarter under review was Rs 174 crore, against Rs 173 crore in the previous corresponding period.

Profit growth was marginal despite a 11% growth in total income from operations at Rs 1,912 crore due to increased outgo on account of a 25% rise in power purchase cost as well as rise in employee costs.

The company sold 2,700 million units of power during the quarter against 2,550 million units in the previous corresponding period – a near 6% growth in energy sales.