NEW DELHI, JAN 29: The Steel Authority of India Ltd (SAIL) posted a net loss of a whopping Rs 701.27 crore in the third quarter of this fiscal, taking up its cumulative losses since April 1999 to Rs 2049.24 crore.The company's losses for the September to December quarter were 156 per cent higher than in the third quarter of the 1998-99 fiscal. The cumulative losses for the nine months of this fiscal are 130 per cent higher than that of the first three quarters of the previous fiscal, which had ended in a net loss of Rs 1573.66 crore.The results come in the wake of a historic low in unsold steel stocks at the SAIL plants and yards in December, after an aggressive market drive at home and overseas. The export drive helped SAIL earn Rs 712 crore of foreign exchange in the nine months between April and December, which was a 45% growth over its export earnings in first three quarters of 1998-99.Steel exports had helped SAIL earn Rs 490 crore in foreign exchange then. In the third quarter the company'ssales earnings actually increased by Rs 470 crore and its cumulative sales in the nine months were 7.85 per cent higher.According to a SAIL, the net loss was primarily because of five per cent drop in sales realisations, the high capital charges and the additional expenditure on the company's voluntary retirement schemes. A sticky market had compelled steel companies to sell at massive discounts in the last two years and the market only turned profitable towards the end of 1999. The modernisation projects of some of SAIL's integrated steel plants increased its debt burden and so, interest charges and depreciation. In the first three quarters of this year SAIL's ``interest and depreciation burden'' was Rs 2568 crore, Rs 338 crore higher than in the three quarters of 1998-99.The public sector steel giant, now in the midst of a massive restructuring including a downsizing of its lakh strong workforce, spent Rs 240 crore on voluntary retirement schemes between April and December last year. The close toeight per cent increase in SAIL's sales turnover in the three quarters and a 2.1 per cent reduction in ``variable costs of production'' were vastly depleted by a nearly seven per cent increase in expenditure.The company's sales earnings went up to Rs 11767.44 crore between April and December last year, compared to Rs 10910.62 crore in the first three quarters of 1998-99. The more than 15 per cent increase in depreciation and interest charges and higher expenses resulted in a whopping 131 per cent increase in SAIL's gross losses to Rs 2064.84 crore from Rs 890.20 crore in the first nine months of the previous fiscal.The company's net losses were equally high at Rs 2049.24 crore. According to the release, SAIL chairman Arvind Pande has drawn courage from the recovery in steel prices at home. ``The recent market upturn has led to a price recovery in both international and domestic markets,'' Pande says, `` which will help reduce our losses further in the next quarter.''
