15 Jul 2022
Higher realisation from better volumes in Apr-Jun notwithstanding Jindal Steel and Power Ltd’s bottomline performance was hit by a sharp rise in operating costs led by raw material expenses.
The company claimed that it operated under “challenging market conditions” during the quarter.
The company’s consolidated net profit from continuing operations fell 22% on the year to 19.7 bln rupees in the June quarter coming above analysts’ estimate range of 7 bln rupees to 13.9 bln rupees.
The consolidated revenue from operations rose 23% to 130.5 bln rupees, which was within estimates range of 99 bln rupees to 141 bln rupees.
Jindal Steel’s sales volume of steel and pig iron went up by 8.1% on the year to 1.74 mln tn in Apr-Jun.
The company produced 1.99 mln tn of steel and pig iron during the quarter, 1% lower than the year ago period. The company said that this decline was due to maintenance work in one plant and lower coal availability in another plant.
Pellet production by the company fell 11% on the year to 1.92 mln tn.
The company said that lower volume growth was offset by higher realisations that led to the strong growth in revenue.
Jindal Steel’s cost of raw materials which included coking coal costs nearly doubled to 33.6 bln rupees while other expenses jumped 40% on the year to 29.7 bln rupees.
The company said that the consolidated earnings before interest, tax, depreciation and amortisation, adjusted for one-time foreign exchange currency gain of 4.5 bln rupees, was 29.9 bln rupees which was lower by 33% on the year.
The EBITDA margin, as a result, shrank sharply to 19.7% in Apr-Jun from 25.4% in the year ago period.
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