OREANDA-NEWS. January 26, 2012. Sesa Goa Limited ("SGL" or the "Company") today announced its unaudited consolidated results for the third quarter ("Q3") and nine months ("nine months period") ended 31 December 2011.

Unaudited Consolidated Financial Summary

 

 

(in crore, except as

stated)

 

 

Quarter ended

 

Nine months ended

 

 

 

31-Dec

 

 

31-Dec

 

 

2011

2010

Change

2011

2010

Change

Net Sales/Income from

2617

2,250

16%

5,516

5,581

(1%)

operations

 

 

Cash Profit (PBDT)

852

1,346

(37%)

2,126

3,379

(37%)

Net Profit (PAT)*

570

1,065

(46%)

1,411

2,752

(49%)

Net Profit (PAT) Incl.

 

 

 

 

 

 

Associate Income**

692

1,065

(35%)

1,533

2,752

(44%)

Earnings Per Share (T.)#

 

 

 

 

 

 

Basic

7.96

12.41

(36%)

17.64

32.07

(45%)

Diluted

7.96

12.18

(35%)

17.64

32.06

(45%)

Sales

 

 

 

 

 

 

Iron Ore (million tonnes)

5.04

4.78

5%

10.83

11.49

(6%)

Pig Iron („000 tonnes)

68

63

8%

191

201

(5%)

-           #Non annualised

-           *Excluding attributable profit from associate.

-           **Associate Income from Cairn India Limited of T122 crores has been taken from December 08, 2011.

-           Iron ore sales is inclusive of captive consumption in Pig Iron Division (0.06 million tonnes in Q3 as compared to 0.11 million tonnes in the corresponding prior quarter)

Operating Performance

During Q3, iron ore sales were 5.04 mt compared with 4.78 mt (4.36 mt excluding Orissa) in the corresponding prior quarter. During nine months period, sales were 10.83 mt compared with 11.49 mt (10.02 mt excluding Orissa) in the corresponding prior period.

At Karnataka, we sold 0.64 mt of iron ore in Q3 via e-auctions, and 2.45 mt of iron ore for the nine months period, as compared with 0.63 mt and 1.57 mt in the corresponding prior periods. At Goa, we sold 4.40 mt of iron ore in Q3, and 8.38 mt of iron ore in the nine months period, as compared with 3.74 mt and 8.44 mt in the corresponding prior periods.

During Q3, iron ore production was 3.33 mt compared with 4.70 mt (4.29 mt excluding Orissa) in the corresponding prior quarter. During nine months period, production was 8.84 mt as compared with 13.31 mt (11.90 mt excluding Orissa) in the corresponding prior period. The decline is mainly on account of the ban on mining operations in Karnataka and planned reduction in inventories. The ban was imposed by the Hon'ble Supreme Court of India on 26 August 2011 and continues to be in force.

During Q3, pig iron production was at 64,108 tonnes a marginal decline of 6% and sales volumes were at 68,020 tonnes, an increase of 8% as compared with the corresponding prior quarter. Production and sales volumes of pig iron during nine months period was at 189,615 tonnes and 190,710 tonnes. The production & sales volumes were affected on account of low availability of iron ore from Karnataka and decline in the demand from foundries.

Financial Performance

Cash Profit (PBDT) for Q3 and nine months period were  852 crores and  2,126 crores, a decline of 37% on both periods compared with the corresponding prior periods. The profit was impacted on account of higher export duty, lower income from investments; higher interest cost, and mark to market loss on foreign currency borrowings.

During Q3, Sesa Goa Limited acquired 24,307,241 equity shares of Cairn India Limited ("CIL") and 4,500,000 equity shares of CIL were acquired by its subsidiary Sesa Resources Limited aggregating to approximately 1.5% of total paid up share capital of CIL from Cairn UK Holding Limited at an average price of  325 per share on the open market.

With this acquisition Sesa Goa Limited along with its subsidiary, Sesa Resources Limited holds 20% of the share capital of CIL effective 08 December 2011, and has accounted for CIL as an associate effective from this date.

Goa Energy Private Limited ("GEPL")

During the quarter, Sesa Goa Limited and Videocon Industries Limited along with other Shareholders of GEPL have signed a definitive Share Purchase Agreement under which Sesa has agreed to acquire 100% of the outstanding common shares of GEPL for a cash consideration of  53.72 crores on a cash free basis, including net working capital of  2.75 crores and taking over an existing debt of  47.28 crores.

GEPL owns and operates a 30 MW waste heat recovery power plant in Goa which utilizes the Waste heat and gases from SGL's Coke making and Pig Iron facilities.

Interim Dividend

Board of Directors has recommended an interim dividend of 200% i.e.  2.0 per share on equity share of  1.00 each. The record date for the payment of interim dividend is 02 February 2012.

Liquidity and Investment

As at 31 December 2011, the Company had a total debt of  4,381 crores with cash and cash equivalents of  451 crores consisting of  442 crores in debt mutual funds and  9 crores in fixed deposits and cash with banks.

Expansion Progress

Expansion of the pig iron capacity to 625 ktpa and the associated expansion of metallurgical coke capacity to 560 ktpa are nearing completion for commissioning in current quarter, marginally behind expected timelines on account of construction delays.