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SAIL Q3 net profit grows 32% to a record Rs. 1935 crore
New Delhi, January
30, 2008
Steel Authority of India Limited (SAIL) achieved a record
third-quarter net profit (after tax) of Rs. 1,935 crore in
October-December 2007. This was 32% higher than the net profit
of Rs. 1,471 crore achieved during the corresponding period
last year (CPLY). With the company's sales turnover increasing
by 11.4% over CPLY to Rs. 10,756 crore in Q3 of 2007-08,
SAIL's profit before tax (PBT) at Rs. 2,922 crore was also the
highest achieved in any third quarter, rising 31% over Rs.
2,234 crore in CPLY. The unaudited financial results of the
company were taken on record by the SAIL Board of Directors at
a meeting held here this morning.
The company's profitability during Q3 grew mainly due to
improvement in its product-mix, substantial increase in
production of special grade steel and value-added items,
higher net sales realisation and special efforts towards cost
reduction, in spite of sharp increase in cost of inputs such
as ferro-alloys, additives like zinc, copper, etc., and
spares, as well as much higher employee remunerations.
At the meeting, the SAIL Board announced an interim dividend
for the company's shareholders for the fourth consecutive
year, this time at an enhanced rate of 19%, which amounts to
Rs. 784.78 crore. This is the highest-ever interim dividend
paid by the company so far. SAIL had paid interim dividend at
the rate of 16% last year.
Maintaining progressive increase in its profitability during
each quarter of the current financial year, SAIL registered
its highest profit after tax of Rs. 5,160 crore for the
April-December period with a growth of 20% over CPLY. SAIL
also recorded its highest first nine-month turnover at Rs.
30,026 crore, an increase of 9% over CPLY.
SAIL achieved record production of 11.3 million tonnes of hot
metal, 10.4 million tonnes of crude steel and 9.6 million
tonnes of saleable steel during the first nine months of the
current financial year. Around 3.7 lakh tonnes of additional
finished steel were produced during the period from existing
mills by maximising capacity utilisation, reducing production
of semis, and thereby improving the share of finished steel to
84% from 81%.
SAIL plants operated at an average capacity utilisation of
121% during Q3 of 2007-08 against 112% achieved in CPLY, and
produced a record 3.4 million tonnes of saleable steel. For
the first time in a quarter, production of special steels and
value-added items crossed the 1 million tonne mark, recording
a growth of 30%. Substantial growth was recorded in products
like high corrosion resistant TMT bars for coastal areas
(326%), LPG grade steel (24%), TMT bars (32%), plates (18%),
medium structurals (11%), 90 UTS rails (13%), wheels & axles
(6%), CRNO (5%), etc. SAIL also achieved record domestic sales
of 3 million tonnes during Q3.
Continued improvement in major techno-economic parameters
contributed significantly towards the performance. The
important of these include – reduction in coke rate by 1% at
526 kg, energy consumption by 3% at 6.68 giga calories,
increase in production through the energy-efficient CC route
by 10%. Besides, higher yield, lower arisings/defectives,
better operational parameters, reduction in use of
consumables, inputs, power, etc., resulted in cost savings of
about Rs. 135 crore in Q3. Production by SAIL's captive
collieries increased by 30% in Q3.
Borrowings were further reduced by Rs. 412 crore in Q3 to Rs.
2,792 crore as on 31st December 2007. With this, SAIL's
debt-equity ratio came down to the lowest-ever level of 0.13:1
at the end of the third quarter.
The company achieved highest-ever labour productivity of 224
tonnes/man/year in Q3, up from 195 tonnes/man/year during the
same period last year.
The implementation of SAIL's expansion and modernisation plan
by 2010 has proceeded with the placement of orders for several
major packages at IISCO Steel Plant (ISP) and Salem Steel
Plant. Projects worth around Rs. 20,000 crore have been
sanctioned for implementation during the first nine months of
the current financial year. Projects commissioned during the
quarter included rebuilding of Blast Furnace#2 at ISP and
installation of HCL regeneration plant for PL-II of Bokaro
Steel Plant's Cold Rolling Mill.
SAIL has taken several strategic initiatives in recent months,
some of which are: signing of an MoU with Tata Steel for
development of coal mines, setting up Special Economic Zone at
Salem, MoU with Railways for construction of 235-km new tracks
in Dalli-Rajhara, Chhattisgarh, formation of joint venture
company for cement plant at Bokaro, starting of processing
units in different states and expanding the company's
marketing network by appointing dealers in all districts of
the country.
During the third quarter of the current financial year, SAIL
won a number of awards and accolades, including the
prestigious Gold Trophy of the 'SCOPE Award for Excellence and
Outstanding Contributions to the Public Sector Management' for
the year 2006-07 and India's Employer of Choice-2007 award
instituted by CNBC-TV18 in the PSU category, as well as four
Golden Peacock awards instituted by the Institute of Directors
in various categories for excellence in performance.
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