Coal India today reported a nearly 35 per cent rise in net profit to approximately Rs 5,414 crore during the January-March 2013 quarter compared with the same period the previous year.

This is against a mere 2.5 per cent rise in sales revenue.

CIL’s bottomline was substantially impacted by nearly Rs 2000-crore lower spend on ‘employee benefit expenses’ than in the same period the previous year.

Higher realisation

The company reported an almost 5 cent drop in net profit during the January-March 2012 quarter due to the Rs 3,447-crore additional provisioning (including arrears) on account of the wage pact revision.

Though overall sales revenue increased, riding on higher off-take, the average realisation dropped by Rs 19 a tonne during the last quarter.

According to company Chairman S. Narsing Rao, this is due to a sharp drop in prices in the e-auctions. CIL posted a 17 per cent growth in net profit at Rs 17,356 crore during the year 2012-13.

This is against a 13 per cent rise in earnings.

Rao attributes the profit growth to higher volume sales and two per cent higher average realisation of Rs 1,472 a tonne, owing to improved “grade-mix”.

It means the company sold relatively more high-grade coal during the period.

The interest earnings from the company’s mammoth Rs 62,236-crore (Rs 58,202 crore) cash reserves were up by approximately Rs 951 crore.

Pricing

Meanwhile, the board of directors today discussed issues regarding revision in prices of top grade coals (formerly A and B grade), sold at import-parity prices, keeping in tune with the fall in global prices.

Though global prices dropped substantially, CIL did not change the prices of relevant Indian varieties.

“We reviewed the issue,” Rao said.

The prices of the other CIL coal varieties is, however, substantially less than the imported varieties.

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