Iron ore and Coal

India: Tata Sponge Iron Reports Decline in Profit in Q2 FY19

India: Tata Sponge Iron Reports Decline in Profit in Q2 FY19
Mining News Pro - Tata Sponge iron - one of the largest sponge producers in Eastern India has released its quarterly results on 12th October, in which the company reported decline in consolidated profit margins in the second quarter (Q2) of FY19.
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According to Mining News Pro -Tata Sponge iron - one of the largest sponge producers in Eastern India has released its quarterly results on 12th October, in which the company reported decline in consolidated profit margins in the second quarter (Q2) of FY19.


In the report, the company`s net profit declined to INR 2,762 Lacs in Q2 FY19 as compared to INR 4,555 Lacs in the Q1 of FY19, plunge by INR 1,793 Lacs (39.36%) Q-o-Q. Meanwhile on Y-o-Y basis the profits remained flat of Q2 FY19 as against Q2 FY18 at INR 2,761 Lacs.


The firm`s total income also reported a decline of 15.30% to INR 23,107 Lacs in Q2 FY19 as against INR 27,283 Lacs in Q1 FY19. Further, the total expenses reported at INR 18,959 Lacs against last quarter at INR 20,386 Lacs.


Revenue from sponge iron segment decreased to INR 20,504 Lacs in Q2 FY19 from INR 24,592 Lacs in Q1 FY19.


Tata sponge is located in Bilaipada, Odisha, East India & has annual sponge iron production capacity of 390,000 MT. In FY18 the company has achieved its production rise by 6.95%, on Year-on-Year (Y-O-Y) basis the production of sponge iron reported at 4,17,094 MT in FY18 as against 3,90,000 MT in FY17. The daily average production rate during the FY18 was recorded at 1,274 MT.


The company also engaged in power generation with two power plants - 26 MW based on the waste heat recovery technique. And the revenue from power segment also decline to INR 1,467 Lacs in Q2 FY19 from INR 1,967 Lacs in Q1 FY19.


YTD Analysis FY18 & FY19 (ended on 30th September)


1. According to the report, the net profit rose to INR 7,317 Lacs in 2018 as compared to INR 5,817 Lacs in 2017, up by INR 1,500 Lacs (25.78%) Y-o-Y.


2. The Company`s total income also increased to INR 50,393 Lacs in 2018 from INR 37,842 Lacs in the year-ago period.


3. Total expenses of the company were at INR 39,345 Lacs during the period of Apr-Sept’18, as against INR 29,251 Lacs in the same period last fiscal.


4. Revenue from sponge iron segment increased to INR 45,096 Lacs in 2018 from INR 33,229 Lacs in 2017.


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