Jhawar in Calcutta on Thursday. Picture by Kishor Roy Chowdhury
Calcutta, July 31: Speciality steel and wire rope manufacturer Usha Martin has reported a consolidated loss of Rs 21.35 crore during the first quarter of the current fiscal against a net profit of Rs 4.09 crore in the corresponding quarter of the previous fiscal.
Earnings came under pressure because of a 59 per cent rise in depreciation and amortisation expenses at Rs 116.05 crore even as consolidated net sales increased 24.4 per cent to Rs 1,155.28 crore.
The earnings before interest, depreciation, taxes and amortisation stood at Rs 211.14 crore against Rs 181.32 crore in the same period a year ago.
Company chairman and managing director Prashant Jhawar said depreciation charges had been raised from April 1, 2014, affecting the bottomline.
Profits declined in the steel segment during the first quarter, while the earnings of the wire and wire rope segment improved.
The company’s cost of raw materials increased even as its own production of coal and iron ore declined.
Jhawar said the company had completed all its cost reduction initiatives. Stabilisation of the projects is expected to improve the profits in the coming quarters.
The company has appointed consultancy firm Accenture to improve business, reduce costs and improve operational efficiency, Jhawar said.
The company’s plant in Thailand, which is run as a joint venture between Usha Siam Steel and Tesac Corporation of Japan, has started its operations.
The Usha Martin scrip jumped 5.51 per cent to Rs 42.10 on the BSE.