Calcutta, May 29: Coal India has registered an 18 per cent dip in consolidated net profit for the fourth quarter ended March 31, 2014, as the miner had to write off Rs 876 crore on account of a dispute with power producer NTPC on quality issues.
Net profit at the end of the quarter was Rs 4,434.18 crore against Rs 5,413.91 crore in the corresponding quarter of the previous year. Net sales during the quarter was flat at Rs 19,997.98 crore against Rs 19,904.57 crore in the same period a year ago.
Provisions/write-off during the quarter rose 90 per cent to Rs 917.32 crore from Rs 482.52 crore in the year-ago period.
The consolidated net profit during 2013-14 was Rs 15,111.63 crore, a dip of 12.93 per cent over the previous year. Consolidated net sales for 2013-14 stood at Rs 68,810.02 crore against Rs 68,302.74 crore in 2012-13.
In a filing to the BSE today, Coal India said it had introduced the gross calorific value (GCV) system of grading of coal in January 2012. The supply of coal to NTPC was billed at the declared GCV, effective from October 2012.
NTPC had released payments based on GCV determined unilaterally at the receiving end contrary to the provisions of the fuel supply agreements and withheld the balance amount, Coal India said in the filing.
The Coal India stock today dipped 1.77 per cent to Rs 377.60 on the BSE over the previous close.
On the NSE, the CIL stock was down 2.18 per cent to Rs 372.10.
The FSA provides for determination of GCV at the loading end by joint collection, preparation, testing and analysis of the coal sample being supplied.
A settlement formula was reached between the two companies based on the advice of the government for extrapolation of third-party sampling results obtained between October and December 2013 for coal supplied between October 2012 and September 2013.
“On the basis of this settlement formula and pending final reconciliation/settlement of all the subsidiaries of CIL with NTPC, the provision/writeoff of Rs 876.45 crore for such deemed lowering of grade compared to the grade of coal supplied and billed has been considered in the accounts during the quarter/year,” the statement said.