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World’s largest tea producer McLeod Russel Ltd has reported 37 per cent decline in net profit at ₹80.43 crore in October-December quarter.
The total income saw a marginal rise of one per cent to a little over ₹481 crore (₹ 476 crore) for the quarter.
The company said lower price realisation in Africa and crop loss in its Indian gardens owing to unfavourable weather were behind the reduction in profits.
African prices were depressed by 30 per cent. However, Indian teas fetched better price were up by ₹8 a kg owing to overall fall in (Assam) industry production.
The average price per kg for the company stood at ₹173.44 (₹170.93). In the past nine months to December 31, 2014, its net profit shrunk by 33 per cent to ₹269.93 crore.
The company’s production in India was lower by 6.8 million kg.
It also could procure lesser quantity of tea leaves from small growers.
“The trend has been better during the first few weekly sales in 2015 on emergence of demand from West Asia and Pakistan,” the company said in a statement.
It said negotiation for the new wage agreement for three years would start soon.
“We expect the increase to be around 13-15 per cent for the first year, commencing from January 1, 2015”, the company said.
The company’s shares closed at ₹213, down by 3.49 per cent on the BSE.
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