High raw material cost sends Tokyo Cement 1Q profit down despite 33% rise in sales

Tuesday, 16 August 2011 00:41 - - {{hitsCtrl.values.hits}}

Despite a 33% increase in revenue, Tokyo Cement Company (Lanka) Plc had contend with an 11% dip in net profit in the first quarter owing to soaring raw material costs.

In tandem with rising demand for cement, Tokyo Group’s revenue increased to Rs. 4.5 billion from Rs. 3.4 billion in the first quarter of last financial year.

Gross profit rose by 8% to Rs. 888.6 million in the three months ended on 30 June, 2011. However profit before depreciation and financing cost had dipped by 15% to Rs. 530 million, a development which a spokesman for Tokyo linked to soaring clinker prices owing to high demand for cement and shortages. Group depreciation rose by 3% to Rs. 240.6 million and finance cost declined by 26% to Rs. 108.5 million.

Taxation dipped by 26% to Rs. 2.7 million leading an after-tax profit of Rs. 178 million, lower by 19% over the first quarter of FY2010. Net profit attributable to equity holders was Rs. 214 million, down by 11% over a year earlier.

Net asset per share at Group level was Rs. 19.40, up from Rs. 18.81 as at 31March, 2011 whilst that of the company rose to Rs. 15.80, as opposed to Rs. 15.31 at end FY2011.

Last year Tokyo Cement showcased phenomenal growth when net profit attributable to equity holders grew 137% to Rs. 874 million and Group revenue rose by 12% to Rs. 16.5 billion as the economy rebounded post war and demand grew.