Lower realisation pulls NMDC’s net down 21%

The state-run firm had clocked a profit of Rs 1,679 crore a year earlier.

Written by Press Trust Of India | New Delhi | Published: October 25, 2013 4:05 am

Iron ore producer NMDC Ltd has reported a 21 per cent dip in net profit in July-September quarter at Rs 1,318 crore on lower sales realisation due to subdued prices of the raw material even as sales volumes rose.

The state-run firm had clocked a profit of Rs 1,679 crore a year earlier,NMDC chairman CS Verma said here.

The company board,however,recommended a 300 per cent interim dividend.

“Despite higher volume,our sales and net profit were lower compared to the same quarter last year. The reason is the subdued price of iron ore,as a result of which average sales realisation was down by 15 per cent in Q2,” Verma said. Turnover fell 5 per cent to Rs 2,480 crore during the quarter from Rs 2,612 crore a year ago.

NMDC had raised the price of both lumps and fines of iron ore in the current month by Rs 100 per tonne for the first time in the past one year.

Verma said he hoped iron ore prices would remain stable for the remainder of the current financial year and that increased sales on the back of better demand from steelmakers would improve the company’s profitability.

During the July-September quarter,NMDC produced 5.94 million tonnes of iron ore while the volume of sales was 6.5 MT,which is 11 per cent higher than the corresponding quarter last fiscal. pti

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