October 13, 2005
Half Yearly Statement
Dear Shareholder,
I take pleasure in communicating to you the performance of your Company for the past six months ended 30th September, 2005 .
During the period under review, the company has produced 1,15,902 mt of sponge iron as compared to a production of 1,12,063 mt in the corresponding period of the previous year and sold 1,12,501 mt of sponge iron as compared to 1,09,933 mt in the corresponding period of the previous year. The sponge iron market is bouncing back after a brief decline for which the net realisations have reduced. Raw material prices have increased considerably, which have resulted in a reduced profitability of the Company during the period under review.
The profit before tax has therefore registered a decrease of 40% and the profit after tax as well as earnings per share have registered a decrease of 37% over the corresponding period (six months) of the previous year. Your company, however, continues to be an EVA positive company.
Project work for the 3rd kiln installation is under progress and the kiln is expected to be in operation by the end of this fiscal. Installation work of the second power plant of 18.5 MW capacity has also begun and can be expected to be complete by June 2006.
Your Board at its meeting held on 14th July 2005 has approved a proposal for the setting up of the 4th kiln of 1,50,000 tpa capacity along with the third power plant of 18.5 MW capacity. Action is on to obtain the requisite clearances / approvals from concerned government agencies for these two projects.
I look forward to your continued support for the company's growth plans to achieve a higher level of turnover.
| Kolkata 13th October, 2005 |
B. Muthuraman Chairman |