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Jindal Steel posts profit of Rs 1.1 bn in June quarter on higher revenues

Aditi Divekar/Mumbai 09 Aug 18 | 10:14 PM

Company's power business, Jindal Power Ltd, continues to generate cash profits which stood at Rs 1.67 billion in the reported quarter

Naveen Jindal-led Jindal Steel & Power swung to profits at Rs 1.10 billion in the June quarter on the back of higher revenues even as expenses mounted considerably on a year-on-year basis.

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The company had reported a consolidated net loss of Rs 4.20 billion in the corresponding period last year. The company has reported a consolidated quarterly profit after 14 loss-making quarters, it said in a statement. Net sales of the Delhi-based steel producer stood at Rs 96.02 billion in the period under review, up 34 per cent from the same period last year on better realisations. 

“The outcome of 3 years of hard work is evident from the results. With the 6 million tonne integrated steel plant at Angul tracing the planned ramp-up blueprint, we are confident of setting new production and sales benchmarks with every passing quarter," Chief Executive Officer N A Ansari was quoted as saying.

Jindal Steel was expected to report a bottom line of Rs 1.32 billion in the June quarter and churn a revenue of Rs 88.94 billion, according to Bloomberg estimates.

On a consolidated basis, Jindal Steel's Ebitda (earnings before interest, taxes, depreciation and amortization) in the June quarter stood at Rs 22.77 billion, up 68 per cent from the same period last year. 

During the June quarter, Jindal Steel's standalone steel sales stood at 1.19 million tonne, up 46 per cent on a year-on-year basis. Jindal Steel's pellet plant continued its performance by recording a production of 1.76 million tonne during Q1. The company aims at ramping up production at its coal mines in Australia, South Africa and Mozambique in the coming quarters, it said.

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Meanwhile, the company's power business, Jindal Power Ltd, continues to generate cash profits which stood at Rs 1.67 billion in the reported quarter. The revenues from power operations declined 10 per cent in the period under review from the same period a year ago to Rs 17.59 billion.

Among global ventures, Jindal Steel's Oman operations reported Ebitda of $68 million in the June quarter, which was double the Ebitda of $32 million in the corresponding period last year.

The company's Mozambique and Australian (Wongawilli) mines continue to ramp up, while Russell Vale mines of Australia remain in care and maintenance. 

“We are aiming at further accelerating the production momentum at Angul and Oman, as well as take Raigarh steel plant capacity utilization to near 100 per cent levels," Ansari was quoted as saying.

Jindal Steel recently bagged an order for supply of close to 100,000 tonne of Rails under a global tender floated by the Indian Railways, which saw participation from seven leading global rail manufacturers to meet its forthcoming requirements.

“The recent order for supply of Rails to Indian Railways has come as a major boost in our Making In India impetus. We aim at accelerating the deliveries to Indian Railways so as to emerge as a reliable long-term partner for the modernization and expansion plans of the national transporter," said Ansari. “With a capacity to produce over 50,000 Tonne of Rails every month, JSPL is confident to assist Indian Railways for faster completion of their planned rail track rollout targets", he added.

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