CUMI's Q1 net drops despite increase in turnover

Chennai: The city-based abrasives major Carborundum Universal Limited (CUMI) has posted increased sales and lower net profit for the first quarter of 2007-08. The company registered sales of Rs140 crore, an increase of 23 per cent over previous year's corresponding period. Exports during the period under review went up by 25 per cent to Rs17.8 crore.

The profit before tax was Rs16.7 crore (previous year: Rs19.2 crore). As a result of the aggressive capital expenditure programmes undertaken by the company, interest costs for the current year was Rs3 crore (as compared to Rs0.6 crore last year). Net profit was Rs11.3 crore (previous year: Rs13 crore).

During the period under review the abrasives division achieved a sale of Rs95.6 crore (previous year: Rs80.2 crore). The order inflow and sales of non-standard products registered strong growth rates.

The product availability points (PAPs) at Middle East and Canada helped the company to step up its exports. The PAP at Netherlands has gone into full-fledged operations.

The ceramics division earned Rs28.4 crores. According to the company demand from domestic key user industry segments of power generation, coal washeries, steel, cement, carbon black and glass was good. Strong growth was witnessed in both the domestic and export market.

The company's third division electrominerals earned Rs24.7 crores.

CUMI's bonded abrasives project at Uttarkhand and the wear resistant liner plant at Hosur are nearing completion and are expected to be commissioned in the next quarter. Work on setting up of a new metallised cylinder plant at Hosur and the second super refractories plant at Ranipet have commenced.