A Rs 288-crore forex hit marked to market and elimination has taken a heavy toll on Lanco Infratech Ltd’s performance numbers for the second quarter ended September 30, 2011, with the company ending up with a loss of Rs 259.48 crore.

In spite of a 97 per cent growth in cash profit of Rs 440.5 crore against Rs 225.0 crore in the corresponding quarter, the company closed the quarter with a loss of Rs 259.48 crore against a net profit of Rs 70.46 crore in the corresponding period last year.

The company’s revenues for the second quarter were up 29 per cent before elimination at Rs 3,341.4 crore against Rs 2,580.3 crore for the corresponding quarter last year. Revenues after elimination were down five per cent at Rs 1,967.2 crore (Rs 2,071.8 crore).

The Chief Financial Officer of Lanco Infratech, Mr J. Sridhar, told Business Line “the forex loss is MTM (marked to market) and is notional due to dollar fluctuation. If the rupee strengthens, this could be made up. Since the dollar borrowings are over a period of three years, we did not hedge them. In addition, the high interest rates are impacting the numbers.”

What the company lost due to US dollar has begun gaining with Australian dollar.

Due to tough macro economic conditions, high interest rates and lower energy trading costs, the power business revenue was lower by about 26 per cent at Rs 994.7 crore against Rs 1,342 crore for the corresponding period last year. The trading arm of the company traded about 1,546 million units compared with 1,920 mu.

While the property business too had lower yields, the EPC division registered a growth of 79 per cent from Rs 1,222.4 crore to Rs 2,184.7 crore.

The company currently has an installed capacity of 3,900 MW, of which 3,300 MW is operational. The second unit at Udupi is not being run due to inadequate evacuation capacity.

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