Hindustan Copper (513599) Q4 08/09 earnings summary

Executive summary

• FY2008-09 turnover fell to Rs 1,349.10 crore from Rs 1,839.79 crore; profit after tax shifted to a Rs 10.31 crore loss from Rs 246.46 crore profit.

• Production was disrupted by smelter shutdowns, low ore grades, equipment constraints and water shortages; Miniratna Category-I status was conferred.

Financial highlights

• Sales were Rs 1,349.10 crore versus Rs 1,839.79 crore; PBT was Rs 5.48 crore versus Rs 302.50 crore.

• Net loss after tax was Rs 10.31 crore versus net profit of Rs 246.46 crore; cash profit was Rs 21.92 crore versus Rs 316.55 crore.

• Positive gross margin was maintained despite lower copper prices; value of production was Rs 1,344.27 crore versus Rs 1,993.48 crore.

Outlook and guidance

• FY2009-10 was expected to yield significant value from mining as operational constraints eased; copper prices were expected to stay subdued but above breakeven.

• Strategy focused on new deposits, mine development and optimizing existing mines; plans included reopening Kendadih and expanding Malanjkhand open-pit mining.

• Malanjkhand excavation outsourcing was planned for 320 lakh bank cubic metres over five years, potentially extending mine life to 2019 from 2014.