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Tisco's net, sales down

Steel giant Tata Iron and Steel Company Limited has posted a lower net profit of Rs 270.9 million during the first quarter ended June 30, 1998 as against Rs 655.9 million reported in the corresponding period of the previous year.

Company's net sales and income from operations declined marginally to Rs 13.53 billion during the three months ended June 30, 1998 against Rs 13.96 billion recorded in the corresponding period of the previous year.

The operating profit also declined to Rs 2.28 billion from Rs 2.41 billion, a company statement said.

According to unaudited results for the first quarter, the steel production increased by nine per cent to 725,120 tonnes and sale of steel products by 11 per cent to 615,700 tonnes with a marginal revival in construction activity.

The trend in cement market was encouraging and cement sales in the first quarter increased to 378,000 tonnes (last quarter: 365,000 tonnes) while ball bearings business continued to be below expectations. Tubes division has shown signs of revival both in terms of demand and price.

Company's gross profit after interest but before depreciation, employee separation compensation and taxation stood at Rs 1.59 billion during the first quarter of this year against Rs 1.89 billion recorded in the first quarter of the previous year.

The company continues to invest in its modernisation programmes aimed at production of high value-added items. The project for increasing the hot strip mill capacity to 2 million tonnes (from present 1 million tonnes) has been progressing ahead of the schedule, and trial runs are currently going on. The benefit of additional production will be available in the second half of the year.

Meanwhile, reacting to the subdued performance of the company, Tisco scrip declined by Rs 9.80 to Rs 113.10 against the previous close of Rs 122.90 on the Bombay Stock Exchange. Similarly, the scrip fell sharply by Rs 9.80 to Rs 113.10 against the previous close on the National Stock Exchange.

UNI