Lloyds Metals And Energy (512455) Q4 98/99 earnings summary

Executive summary

• FY1998-99 sales fell to Rs. 16,918.78 lakh from Rs. 33,084.61 lakh; net loss widened to Rs. 3,799.60 lakh from Rs. 1,159.20 lakh.

• Recession, lower capacity utilization, import competition and pricing pressure drove weaker results; the Dombivli CRCA plant was temporarily shut.

Financial highlights

• Total income was Rs. 17,379.71 lakh vs Rs. 33,558.36 lakh; profit before interest, depreciation and tax was Rs. 1,118.28 lakh vs Rs. 3,575.28 lakh.

• Finance charges rose to Rs. 3,627.39 lakh from Rs. 3,367.04 lakh; loss before tax was Rs. 3,799.52 lakh vs Rs. 1,158.81 lakh.

• Prior-period expenses, net, were Rs. 347.25 lakh; excess depreciation provision written back was Rs. 626.54 lakh.

Outlook and guidance

• Management expected demand stagnation to persist amid economic slowdown and intense domestic competition; government measures were expected to reduce the threat from dumped imports.

• Reopening the Dombivli CRCA plant would be considered after monitoring market conditions.

• Sponge iron Phase II expansion and a 12 MW captive power plant progressed slowly after a technology change; the revised proposal was under consideration with financial institutions.