The Hindu Business Line : Raymond reports fall in net profit

RAYMOND Ltd on Monday reported a net profit of Rs 32.04 crore for the second quarter ended September 30, against Rs 39.49 crore in the corresponding quarter of the previous fiscal.

According to a press release, profit was impacted due to the depreciating rupee, which resulted in a foreign exchange loss of Rs 2.77 crore (previously a gain of Rs 6.42 crore); and higher interest charges of Rs 5 crore (net interest income of Rs 3.40 crore).

The company had to make a one-time excise duty payment of Rs 12.97 crore towards the credit taken for excise duty on stock of inputs as on July 8, 2004, owing to changes in the Central Excise Act, 1944, with respect to excise duty exemption on products manufactured by the textile division.

It had to write off VRS compensation payment of Rs 1.01 crore and additional wages/benefits cost it Rs 4.72 crore (including arrears). Higher raw material costs, especially cotton and steel also had its effect on net profit.

Sales grew to Rs 344.11 crore (Rs 322.91 crore) for the same period.

The Textile Division revenue for the second quarter registered a growth of 6.58 per cent in value at Rs 240.71 crore (Rs 225.85 crore).

The Denim Division also recorded a 38.94 per cent growth in its revenue at Rs 60.48 crore (Rs 43.53 crore) for the second quarter. Export growth of the Denim Division was higher by 66.67 per cent in value at Rs 35 crore (Rs 21 crore).

Subsidiary Hindustan Files Ltd achieved profits during the half year ended September 20, due to restructuring of products and processes that resulted in the reduction of its negative net worth.

Plugin Sales Ltd also reduced its current level of losses in the half year ended September 30, compared to the previous year through increased retail market participation, improvement in margin and cost cuts.

J.K. Files and Tools Division recorded a 29.48 per cent growth in revenue to Rs 38.17 crore (Rs 29.48 crore) for the second quarter.

Commenting on the results, Mr Gautam Hari Singhania, Chairman and Managing Director, Raymond Ltd, said, "The company is confident of achieving the planned performance for 2004-05 as there is increasing buoyancy in all its businesses."