By IANS,
Chennai: City-based abrasives major Carborundum Universal Ltd (CUMI) posted a 25 percent growth in its consolidated sales and 56 percent net profit for the third quarter ending Dec 31.
Part of the Murugappa Group, CUMI closed the period with net sales of Rs.408 crore and an after tax profit of Rs.37 crore as against Rs.327 crore and Rs.24 crore declared in the corresponding period of the previous year.
The company expects the buoyancy in revenues to continue during the next quarter but said the main challenge will be increasing raw material costs which would be addressed by price adjustments and improved efficiencies.
Buoyed by strong demand in Indian and Russian markets, CUMI’s abrasives division earned Rs.185 crore up from Rs.114 crore earned during the corresponding quarter of the previous year.
Its electrominerals division maintained sales at about last year’s levels. Sales for the quarter were Rs.145 crore. The domestic and international market for all ranges of fused minerals was positive, driving on the growth trend registered by the user industries.
Silicon carbide sales of the group’s Russian acquisition, Volzhsky Abrasive Works recorded an increase of 17 percent mainly due to higher price realisation. Despite this, the business was not able to recover fully the steep increases in costs (power and pet coke) leading to a drop in profits.
In South Africa, sales of of CUMI’s venture Foskor Zirconia were flat as the appreciation in the local currency diminished competitiveness despite increased demand. Profitability of the business was eroded due to increased power and fixed costs and due to sales contracts in place at previous prices.
In India, CUMI’s electro-minerals business did well with all the three major product groups – silicon carbide, brown fused alumina, and white fused alumina – recording higher sales.
During the Q3 period, the ceramics business recorded a sales of Rs.85 crore with a strong off-take from cement, material handling, mineral processing industries, iron and steel and carbon black industries.