Nalco posts 28.4% dip in net profit in Q1

KOLKATA: National Aluminium Company (Nalco), the country's largest state owned aluminium major, posted a 28.4% slide in net profit to Rs 160 crore in Q1FY14 against Rs 223 crore in Q1 last year. The drop in profits came on top of a 10.6% decrease in net sales to Rs 1537 crore in Q1FY14 against Rs 1718.30 crore in same period last year mainly due to lower realisation. Nalco's Q1 results were much below analysts' estimates on the company's bottomline.

During Q1 FY14, staff costs rose 13.4% year-on-year (y-o-y) to Rs 321 crore from Rs 283 crore in Q1 FY13, while other expenses rose 16.7% to Rs 361crore from Rs 309.59 crore in Q1FY13. The financial results were approved by the board on Wednesday.

"With aluminium prices under pressure and staff costs rising, Nalco's profitability is likely to remain under pressure in the next one year, a metals sector analyst said.

During the quarter Nalco commissioned a 46.7 MW wind power plant at Jaisalmer in Rajasthan at an investment of Rs 283 crore. "Due to constraints in supply of coal, 198 pots in its smelter plant were taken out of circuit during the quarter," the company said. During the quarter, Ansuman Das assumed charge as a full time chairman and managing director of the company ending months of uncertainity about the leadership of the company.