Hindalco Q2 net more than trebles to Rs440 crore

Aditya Birla group firm Hindalco Industries has reported a net profit of Rs440 crore for the July-September 2016-17 quarter - a more than three-fold jump from the corresponding period of the previous year even despite near-flat revenues.

Profits were boosted by a fall in the company's total expenses even as Hindalco's net sales stood flat at Rs9,562 crore in second quarter of the current fiscal.

Hindalco's revenue from aluminium sales (excluding Utkal) were 10 per cent higher year-on-year  on the back of stong volume growt. However, copper revenues were down 9 per cent year-on-year, the company stated in a release

Copper revenues declined due to fall in copper London Metal Exchange prices, along with lower premium and lower co-product prices (sulphuric acid and Di-ammonium phosphate), it said.

However, a drop in expenses, especially in the July-September quarter helped Hindalco improve operating profits, which more than doubled to Rs805 crore in the July-September 2016-17 quarter against Rs316 crore in the same period last year.

"The company delivered robust operational performance in challenging macroeconomic conditions. Its operational performance was also supported by benign energy prices and some recovery in the aluminium prices," Hindalco said.

Also, an exceptional income of Rs85 crore realized from the sale of the entire holding in its subsidiary, Aditya Birla Minerals, Australia, helped improve bottomline for the aluminium producer.

Hindalco completed divestment of Aditya Birla Minerals Ltd (ABML), Australia during the July-September 2016-17 quarter and the transaction yielded Rs145 crore. The total cash consideration from this deal stood at Rs367 crore, according to the company.

Hindalco said it has a good portion of its coal requirement so far in the recent coal linkage auctions, at a reasonable premium to government notified price. This, along with the existing linkage for Renusagar power plant and captive coal mines will provide adequate coal security.

Going forward, the company said, macroeconomic headwinds and an uncertain global economy pose challenges. In addition, supply spikes from Chinese smelter restarts could impact sales and price recovery, Hindalco stated in its release.