Vedanta group firm Sesa Goa today reported over 35% decline in its consolidated profit at Rs 691.52 crore for the quarter ended December 31, 2011 due to slew of reasons, including higher export duty and losses incurred on foreign currency borrowings.
The company had reported a profit of Rs 1,065.29 crore during the corresponding quarter of 2010-11.
Net sales, however, recorded a growth of 16.32% at Rs 2,617.08 crore during the quarter under review vis-a-vis Rs 2,249.99 crore in the same period of of FY11, the company said in a filing to the Bombay Stock Exchange (BSE). "The profit was impacted on account of higher export duty, lower income from investments, higher interest cost and mark to market loss on foreign currency borrowings," a company statement said.
During the quarter, Sesa Goa had to pay an export duty of Rs 448.48 crore, a rise of over 284% rise, while costs on raw materials increased by 96.67% to Rs 179.56 crore.
Mark to market losses on foreign currency borrowings were at Rs 177.93 crore, while the interest payments rose by 445% to Rs 72.98 crore.
During the quarter, the company also accounted Rs 122 crore as income from Cairn India, in which it holds about 20% stake post acquisition of the oil exploration firm by Vedanta group.
In the October-December quarter, company's iron ore sales were 5.04 million tonne vis-a-vis 4.78 million tonnes of the same quarter of 2010-11. This excludes 4.36 million tonnes of iron ore sales reported by the company from Odisha in Q3 of FY11, as it has exited from mining in the state.
Of this, Sesa Goa sold 0.64 million tonne from Karnataka from its existing inventories as there has been a ban on iron ore production from the state, imposed by the Supreme Court on August 26, 2011.
Company's iron ore sales from Goa also increased during the quarter to 4.40 million tonne vis-a-vis 3.74 million tonnes of the same period of last fiscal.
However, company's production in the third quarter suffered due to mining ban in Karnataka as it stood at 3.33 million tonne, down by over 29%.
"The decline is mainly on account of the ban on mining operations in Karnataka and planned reduction in inventories. The ban was imposed by the Supreme Court India on August 26, 2011 and continues to be in force," the Sesa Goa statement said.
As on December 31, 2011, the company has a total debt of Rs 4,381 crore.
Shares of the company closed today at Rs 200.05 apiece on the BSE, up 5.65% from the previous close.