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Hindustan construction Q1 net falls 41% hit by forex losses

Hindustan construction Q1 net falls 41% hit by forex losses
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First Published: Fri, Jul 24 2009. 06 02 PM IST
Updated: Fri, Jul 24 2009. 06 02 PM IST
Mumbai: Hindustan Construction Co Ltd said on Friday profit for the June-quarter fell 41% hit by forex losses and on higher other income in the year-ago quarter.
Net profit fell to Rs182 million from 308.4 million, as other income fell to Rs18.9 million in April-June from Rs128.3 million a year ago, the company said.
The company’s net sales rose 7.7% to Rs9.64 billion during the quarter. Operating margins improved during the quarter to 12.8% from 10.5% a year ago, a company presentation showed.
Other income a year ago included sale of land of Rs619 million and accounted for exchange losses of Rs505.7 million. This year’s exchange losses were Rs26.4 million.
The company has Rs25 billion in debt which will be brought down to Rs21 billion post its placement of shares with institutional buyers, Praveen Sood, group chief financial officer told analysts at an investors’ meet.
It has cash of Rs500 million and net working capital of Rs20 billion, he said, adding that construction company is eyeing revenue of Rs45 billion0 by the end of the year.
HCC said the results for the quarter were not comparable with year-ago figures.
“Profit before tax or profit after tax is not comparable with previous year’s corresponding quarter on account of non- operational exceptional income,” the company said in a statment.
The company also spent about Rs103 million on inauguration expenses and donation to political parties for Mumbai’s sealink, which opened at the begining of the month.
Adding back the two expenses, “at PAT (profit after tax)-level we would be the same,” Sood said.
There has been a gap in new construction orders for India’s builders between India’s general elections in May and the federal budget announced earlier this month and new orders will start trickling in by September, Sood said.
Hindustan Construction’s order book, which consists of 51% of power projects, at the end of the June quarter, stood at Rs154 billion. It is the lowest bidder for three projects worth Rs8 billion, a statement from the firm said.
During the quarter, it raised $100 million via share sales to institutional investors, which will be used to lower interest costs. Interest costs were up 57% from a year ago to around Rs613 million.
Shares in Hindustan Construction closed down 0.13% at Rs111.30, in the Mumbai market that finished up 0.97% at 15,378.96 points.
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First Published: Fri, Jul 24 2009. 06 02 PM IST