Hindustan Copper (513599) Q4 96/97 earnings summary

Executive summary

• FY 1996-97 turnover was Rs 980.24 crore vs Rs 1,118.02 crore; net loss was Rs 130.62 crore vs profit of Rs 75.84 crore.

• Copper sales hit a record 68,108 tonnes, while production was constrained by power shortages, mine closures and cash-flow pressure.

Financial highlights

• Value of production was Rs 1,005.29 crore vs Rs 1,186.27 crore; production costs before depreciation, amortisation and interest were Rs 1,041.40 crore vs Rs 1,015.62 crore.

• Loss before depreciation, amortisation and interest was Rs 36.11 crore, compared with profit of Rs 170.65 crore; interest was Rs 40.67 crore vs Rs 39.66 crore.

• Net loss of Rs 130.62 crore followed depreciation and amortisation of Rs 53.84 crore; no dividend was proposed.

• Record wire-rod production was 41,332 tonnes, up 11% YoY; gold, silver, nickel sulphate and selenium also reached production records.

Outlook and guidance

• Competitive pressure expected to rise as trade barriers ease and private smelters using imported concentrate add capacity; industry capacity was projected at 516,000 tonnes by 2000.

• Priorities include benchmarking operations, reducing manpower through VRS and mine closure, reassessing smelter capacity, improving quality and raising output from low-cost Malanjkhand.

• Hydrometallurgy was under study as a potential technology shift; the outlook cited a committed workforce and experienced executives.

• Khetri smelter and refinery expansion to 100,000 tpa awaited final PIB clearance; estimated cost was Rs 528.65 crore, including Rs 128.43 crore in foreign exchange.