NALCO posts INR 731 cr net profit in 2015-16

At a time when 70% aluminium companies world over have reported loss, as also reduced production, and the aluminium industry is reeling under heavy pressure due to sluggish international market, National Aluminium Company Limited (NALCO), a Navratna PSU under Ministry of Mines, Government of India, has remained profitable by successfully handling the market downturn by becoming the lowest cost producer of alumina in the world and focusing on increased bauxite mining and alumina refining, besides effecting several cost reduction measures, particularly in metal production.

It may be noted that while the average London Metal Exchange (LME) price per tonne of aluminium in FY14-15 was 1889 USD per tonne, it slumped to an average of 1592 USD in FY 15-16 i.e a fall of 16%.

According to the audited financial results for 2015-16, taken on record by the Board of Directors in a meeting held here on Saturday, during the 4th quarter NALCO has registered a net profit of INR.208 crore, as compared to INR.133 crore in the preceding quarter and INR.355 crore during the corresponding quarter of the previous fiscal. Overall, during 2015-16, the company has posted a net profit of INR.731 crore, compared to INR. 1322 crore achieved during the previous year. The gross turnover of the company during 2015-16 has been INR.7157 crore.

The NALCO Board also recommended a final dividend of 15% amounting to INR.193.29 crore. Earlier, the company had declared an interim dividend of 25%, amounting to INR.322.16 crore, on the paid-up equity share capital of INR.1288.62 crore. The total dividend for 2015-16 works out to INR.515.45 crore and including dividend distribution tax (DDT) it comes to INR.620 crore.

The aluminium major has registered an all-time high production of 63,40,142 tonnes of bauxite in 2015-16 i.e. about 10% higher, and 19,53,000 tonnes of alumina i.e. about 6% higher than the corresponding figures of the previous fiscal. The company also produced 3, 72,183 tonnes of metal, registering an increase of 14% as compared to the corresponding figure of the previous year. During the year, power generation was up by 14% at 5841 million units, while the metal sale was higher by 14% at 3,72,424 tonnes, as compared to previous year.

Meanwhile, in a significant development, during the recent visit of PM to Iran, Dr. Tapan Kumar Chand, CMD, NALCO, signed an MoU with Vice Chairman of Planning Board, Govt of Iran to explore the possibility of setting up an aluminium smelter in Iran. A taskforce is being constituted taking experts from NALCO and its Iranian counterpart IMIDRO. Among other things, the MoU envisages tolling arrangement with existing smeltes in Iran, for producing aluminium from NALCO’s surplus alumina.

Besides, NALCO Board in a meeting held in New Delhi on last Wednesday, approved the proposal to buy back up to 64.43 crore shares i.e 25% of paid up equity share, at INR.44 per share, for a total value of about INR.2835 crore.