Essar steel operating profit up by 64% at Rs.608 cr.(USD 130.30 million) for FY 2000-01
Review of Operations
During the year, the company significantly improved its performance. This was possible mainly on account of shift to value-added grades, higher volumes both in production and sales. The production at 16.80 lakh tonnes (15.30 lakh tonnes in the previous year), a growth of 10% and sales volumes at 16.32 lakh tonnes (16.2 lakh tonnes in the previous year), a growth of 1%. ESTL exported 6.99 lakh tonne (6.45 lakh tonnes in the previous year), a growth of 8%. The income from exports at Rs. 886.27 cr ( USD 190.02 million)(Rs.764.26 cr. ( USD 163.86 million) in the previous year), registering a growth of 16%.
Commenting on the performance, Mr. J Mehra, Managing Director, Essar Steel, said, “The Company’s efforts in improving the operational efficiency in terms of cost reduction, better product mix, etc. have borne fruits which is well reflected in increase EBIDTA by 64.2%. While the operations of the Company have improved, the stagnating demand and surplus capacity of over 30% in the domestic market have led to severe drop in HRC prices by over 20% during the year. Thus negatively impacting the bottomline.
This is in line with the international trend of softening of HRC prices and demand. International prices of HRC have dropped from USD 300 per tonne at the beginning of the year to USD 200 per tonne today. The current scenario of oversupply and demand stagnation is likely to continue for the next 2-3 years”.
Financial Performance
In line with the performance of the steel industry, Essar Steel has posted an operating profit of Rs.607.70 cr. ( USD 130.30 million) for the financial year ended March 31, 2001. The financial performance of the Company has shown significant improvement over that of 1999-00 when ESTL earned an operating profit of Rs.370.07 cr.( USD 79.35 million), a growth of 64.2%.
Total income for the year registered a growth of 3.8% at Rs. 2565.05 cr.( USD 549.97 million) as compared to Rs. 2470.15 cr. ( USD 529.62 million) during the corresponding period of the last year. After providing interest and similar charges at Rs.647.07 cr. ( USD 138.74 million)(Rs.588.09 cr. ( USD 126.09 million)in the previous year), and net depreciation at Rs.239.10 cr.( USD 51.27 million) (Rs. 329.81 cr.( USD 70.71 million) in the previous year), the Company has reported a loss of Rs.345.91 cr.( USD 74.17 million) (against Rs. 580.72 cr. ( USD 124.51 million) loss reported in the previous year). The loss has been reduced by 40.5% over the previous year.
ESSAR STEEL LIMITED
Regd. Office: Post Hazira, Pin 394 270, Dist. Surat
Corp. Office : Essar House, 11 Keshavrao Khadye Marg, Mahalaxmi, Mumbai 400 034.
Audited Financial Results for the year ended 31st March, 2001
Particulars
Year ended
31.03.2001
31.03.2001
31.03.2000
USD million
Rs in Crores
Rs in Crores
Other Income
9.91
46.22
48.31
Total
549.97
2,565.05
2,470.15
Total Expenditure
a) (Increase) / Decrease in Finished Stock / WIP
(11.62)
(54.20)
155.17
b) Consumption of materials
295.18
1,376.74
1,243.97
c) Staff cost
10.46
48.80
51.36
d) Other expenditure
125.65
586.01
649.58
Gross profit before interest, depreciation, amortisation and taxation (EBIDTA)
130.30
607.70
370.07
Interest and similar charges – Net
138.74
647.07
588.09
Gross profit / (loss) before depreciation / amortisation and taxation
(8.44)
(39.37)
(218.02)
Amortisation / Deferred Revenue expenses written off
14.46
67.44
32.89
Depreciation (Net of write back of depreciation of earlier years)
51.27
239.10
329.81
Gross profit / (loss) before taxation
(74.17)
(345.91)
(580.72)
Provision of taxation for earlier year
-
-
0.52
Net profit (loss)
(74.17)
(345.91)
(581.24)
Paid-up equity share capital
70.83
330.35
330.35
Reserves excluding revaluation reserves as at 31st March
140.65
655.98
1,004.51
Basic and diluted EPS ( in US$ and Rupee )
(0.22)
(10.47)
(17.59)
RBI reference rate 1 US$= Rs. 46.64
Notes:
The above results were taken on record at the meeting of Board of Directors held on June 26, 2001.
Interest has been calculated on the basis of approval of the lead Institution for it's loans. Approval process by some of the participating Institutions is under progress.
The company has recomputed the depreciation under units of production method based on the technical review carried out and on an expert opinion of a reputed Chartered Accountant and necessary adjustment in depreciation has been made during the year under review for which Central Government approval is awaited.
The aggregate of non-promoter share holding was 22,54,39,137 shares (67.45%) as on March 31, 2001.
Figures have been regrouped wherever necessary to make them comparable.
Provision for taxes has not been made in view of losses for the financial year ended March 31, 2001.
CORPORATE
