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ACC's 1998-99 net soars to Rs 568.4 million, 15 pc pay-out again

Associated Cement Companies has posted an impressive growth of Rs 434 million (323 per cent) in its net profit at Rs 568.4 million for the financial year ended March 31, 1999 as against Rs 134.4 million the previous year.

The overall income of the company grew by Rs 2.57 billion to Rs 27.42 billion as against Rs 24.84 billion.

During the year, sales volume including traded cement aggregated to 9.98 million tonnes as compared to 9.42 million tonnes the previous year, registering an increase of six per cent, in spite of the continuing supply overhang in the cement industry and the slowdown in the economy.

Beating the recessionary trend in the industry, ACC's sales turnover jumped up nine per cent to Rs 26.06 billion.

The higher profit, however, failed to encourage the board of directors to announce any increase in dividend to shareholders which was maintained at 15 per cent.

According to a company release, in view of improved sales realisation of cement during the year coupled with company's continuing efforts on controlling costs, operating margin (before interest depreciation and non-recurring items) has gone up by 36 per cent over the previous year.

T M Nambiar, ACC's managing director, said that for three years in succession, the company was able to hold the variable costs without any increase in spite of the inflationary impact affecting the input prices.

Depreciation and interest charges were higher on account of commissioning during the year of several major projects, according to a company statement.

Although the results were better than expected, the ACC's scrip closed nearly steady today at Rs 1,403 after touching the day's high of Rs 1,415 and a low of Rs 1,360 as against yesterday's closing price of Rs 1,403.25 on the Bombay Stock Exchange.

Unveiling company's restructuring plan, S Ganguly, vice chairman, said that the company is taking measures like access of rights issue subject to the approval of the Securities and Exchange Board of India, preferential issue of Rs 1 billion subject to necessary approvals and disposal of assets in the current financial year.

In order to meet the adverse impact, if any, in respect of various outstanding issues, litigation and value of investments, the company has made a provision of Rs 200 million towards contigencies by way of prudence.

The refractory division retained its leadership in the industry, with a turnover of Rs 1.64 billion as compared to Rs 1.73 billion in the previous year. Volume of sales during the year including captive requirement was 112,000 tonnes as compared to 119,000 tonnes the previous year. The marginally lower overall sales volume was attributed to continuing slowdown in the key customer segments.

UNI

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