New Delhi: Jindal Steel and Power on Wednesday reported an over 58 percent decline in its consolidated net profit to Rs 385.33 crore for the April-June quarter mainly due to a one-time Rs 574.12-crore impairment charge made against termination of its Bolivia project.
The Naveen Jindal-led firm had reported a net profit of Rs 918.79 crore during the corresponding quarter of 2011-12.
"The investment made by company in El Mutun Joint Venture Project and other Operations (in Bolivia) have been impaired. As a matter of prudence, the company has made a provision of Rs 574.12 crore in the quarter ended June 30, 2012," JSPL said in a statement.
The Bolivian project included 40-year mining rights of El-Mutun iron ore mines, setting up of Bolivia's first steel plant, an iron ore pellet plant and a sponge iron plant and required a daily gas supply of 10 million cubic metres from 2014.
While terminating the contract on July 16, the steelmaker had cited non-fulfilment of contractual agreement by the Bolivian government on natural gas supplies as the main reason of termination.
Following the announcement of results, the company's shares touched their 52-week low on both BSE (Rs 395.50) and NSE (Rs 395).
However, JSPL shares recovered some lost ground and settled the day at Rs 396.75 on the BSE, still down 4.33 percent. On NSE, it closed at Rs 395.80, down 4.57 percent.
During the quarter, JSPL reported a 18.88 percent growth in its net sales to Rs 4,680.41 crore vis-a-vis Rs 3,937.08 crore of the corresponding quarter of FY'12.
The company's hot metal production increased by 20 percent to 4.84 lakh tonnes (LT), while its slab/round/beam production was up 26 percent to 7.66 LT. Besides, the company reported a 51 percent rise in its power production.
In terms of sales, the company reported an 85 percent rise in its power sales to 584 million kWh, while the steel products sale increased by 23 percent to 5.61 LT.
Earlier this month, the company has also commissioned third unit of 135 MW capacity at its power plant at Angul.
JSPL's unlisted subsidiary Jindal Power, during the quarter, reported a gross turnover of Rs 750.45 crore, while its profit after tax stood at Rs 314.39 crore.
First Published: Wednesday, July 25, 2012, 21:42