Hyderabad: GVK Power and Infrastructure Ltd. on Wednesday said its consolidated net loss widened to Rs281.33 crore in the three months ended 30 June on account of a one-time write-off caused by the demolition of an old terminal at the Mumbai airport controlled by it, coupled with high interest costs and depreciation.

The Hyderabad-based group, which had posted a net loss of Rs30.6 crore in the same quarter of the previous year, said revenue increased 1.88% to Rs712.67 crore in the latest June quarter.

GVK, which operates Mumbai international airport, wrote-off Rs286.78 crore on the terminal demolition. Interest costs rose 70% to Rs320.97 crore at the company that had consolidated debt of Rs22,800 crore as of 30 June. Depreciation and amortisation expenses nearly doubled to Rs178 crore from Rs90.4 crore.

The airport business that contributes around two-thirds of the company’s income reported a loss of Rs271.1 crore in April-June, compared with a profit of Rs168.2 crore in the year-ago period. Revenue from the airport business grew 3.6%% to Rs568 crore.

GVK operates the Mumbai and Bangalore international airports and the Bali airport in Indonesia.

Mumbai International Airport Ltd (MIAL) posted a net loss of 44 crore in the first quarter on a 4.66% increase in revenue to 561.06 crore. Bangalore International Airport Ltd (BIAL) posted a loss of 0 crore as revenue rose 14% to 82.8 crore.

“The loss in BIAL is attributable to higher financial expenses (Rs53.35 crore) and higher depreciation (Rs55.62 crore) on account of the capitalisation of the expansion project," the company said in a statement.

GVK said the profitability of BIAL was dented because the airport operator couldn’t recover costs due to delay in the award of new tariffs.

GVK, through its wholly owned GVK Airport Developers Pvt. Ltd. unit, holds a 50.5% stake in the consortium that operates the Mumbai airport. It has a 43% stake in a separate consortium that runs the airport in Bangalore.

The power division posted a loss of Rs23.7 crore in the first quarter.

“The losses during the year are attributable mainly to the restricted supply of gas for one power plant and nil supply to two power plants as a result of which the plants did not operate at full capacity," the company said.

GVK said it plans to trim debt to the tune of Rs3,000 crore by the end of this financial year.

As part of the debt reduction plan, the company is looking to raise around Rs1,500 crore by the end of September through sale of shares to qualified institutional investors. The company is also looking to raise funds through a stake sale in airports and road projects. It has been in talks with investors to sell stakes in its airport businesses to retire a portion of debt.

“The process of due diligence is on," said Isaac George, director and chief financial officer of GVK.

George said the company had signed term sheets with two prospective investors for due diligence, of which one investor had dropped out citing unfavourable market conditions.

GVK said five of its projects are expected to start commercial operations in this financial year that include the 330 MW Shrinagar Hydro Electric Project on the river Alaknanda in Uttarakhand.

“The cash flows are expected to improve from 2015-16 as the new projects becoming operational," George said.

Shares of GVK fell 4.94% to close at Rs13.08 on the BSE while the benchmark Sensex gained 0.15% to 25,918.95 points.

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