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ACC builds on cement prices

Our Bureau

MUMBAI, Jan. 23

BETTER cement prices and cost-cutting enabled

Associated Cement Companies Ltd (ACC) to notch up a net profit of

Rs 14.64 crore in the quarter ended December 31, 2000

as against a loss of Rs 19.79 crore in the previous corresponding period.

Total income in the third quarter rose by 11.6 per cent to Rs 760.59 crore (Rs 681.79 crore).

Analysts attributed the improved results to the 20-25 per cent increase in cement prices in November and December.

For the nine months ended December 31, 2000, the company registered a net loss of Rs 10.39 crore, taking into account an exceptional outgo of Rs 20 crore (Rs 9.96 crore).

Net sales for the period stood at Rs 2,187.90 crore (Rs 1,993.45 crore).

The company's operating margins increased to 12.5 per cent in the third quarter from 7.8 per cent in the previous period. Mr T.M.M. Nambiar, Managing Director, said the company could achieve this by sustained efforts in reducing costs and improved sales realisation.

"I am optimistic that the trend will continue in the next quarter as I hope cement prices will continue to remain remunerative," Mr Nambiar said.

The volume of total sales (including traded cement) went up by three per cent to 27.14 lakh tonnes from 26.34 lakh tonnes in the previous period.

Total expenditure grew marginally to Rs 665.17 crore (Rs 628.74 crore) while interest was at Rs 44.73 crore (Rs 41.25 crore) and depreciation at Rs 36.05 crore (Rs 31.59 crore).

Mr Nambiar said the overall cost of production per tonne of cement for the nine months ended December 31, 2000 was lower by 4.3 per cent as compared to the corresponding period of the previous year, despite the inflationary impact on input prices.

Sale of cement (including traded cement) rose to Rs 27.14 crore (Rs 26.34 crore) in the third quarter, while for the nine months period, the sale of cement was at Rs 82.86 crore (Rs 76.83 crore).

According to the company, the unfavourable trend of incurring consecutive losses was reversed in the second quarter of 2001. This positive trend had been sustained during the third quarter. The new Wadi plant of 2.6 million tonnes is under implementation and is progressing as per plans.

The company said efforts are on to divest non-core businesses which include ACC's stake in Float Glass India Ltd and Bridgestone Ltd. According to sources, the company is looking for buyers for its stake in Float Glass.

ACC shares closed at Rs 162.05 on the BSE today, marginally higher than tbe previous close of Rs 160.95.