KOLKATA: Coal India registered a near five times rise in net profits during the quarter ended December 2016 against the immediate previous quarter ended September 2016. However, net profits registered a 20% fall during the quarter ended December 2016 when compared to the previous corresponding quarter of December 2015.
The near five times rise in net profit in December 2016 in comparison to immediate concluded quarter has been the result of rise in average realization from e-auction and a large rise in sales. According to Coal India executives, the company managed to get an average realization of Rs 1,564 per tonne of coal sold through e-auction in the December quarter against average realization of Rs 1,337 per tonne in the September Quarter – a near 17% rise. Sales during the quarter under review was 143 million tonnes, against 116 million tonnes in the immediate previous quarter.
Nevertheless, net profit during the quarter under review declined 20% in comparison to the previous corresponding quarter ended in December 2015 due to reduced e-auction realization of around 16%. Additionally, the company had to make a provision of Rs 700 crore for an expected rise in employee benefit that also affected net profit. Profit was down also because the company’s interest income from fixed deposit reduced by Rs 300 crore due to falling interest rates.
Total income from operations for the company during the quarter ended December 2016 was Rs 20,414 crore against Rs 16,212 crore in the immediate concluded quarter of September 2016 and Rs 19,599 crore for the quarter ended December 2015.
Nevertheless, Coal India’s standalone net profits registered a net loss of Rs 39 crore during the period ended December 2016 against a net profit of Rs 1,097 crore in the immediate previous quarter ended September 2016 and a net profit of Rs 671.53 crore in the quarter ended December 2015. According to Coal India executives the loss was due to additional outgo of about Rs 3,000 crore on account of the buy-back. Net loss was also because Coal India subsidiaries are yet to pay dividend to the company. “Coal India’s standalone result is expected to be in the black in the next quarter as its subsidiaries pay dividends,” said a Coal India executive.