It was a bad time for sponge iron and that showed in the overall performance but what pushed it into the red was an exceptional expense of Rs.6 crore. This was prepayment fees of outstanding rupee and restructural term loan to IDBI Bank. This expense pushed the company into the red with a net loss at Rs.3 crore  v/s loss of Rs.2.5 crore in previous Q4.

As such it was a tough quarter with net sales for the quarter falling 32% (YoY) at Rs.82 crore. Thanks to the 40% fall in expenses, it could post an EBITDA of Rs.9 crore v/s loss of Rs.3 crore in previous Q4. But this exceptional expense and 3 times rise in interest cost pushed the company into red. Out of the company’s two units, sponge iron posted a loss at EBIT level while power did better with a 3 times rise in EBIT at Rs.12 crore.

The company ended FY16 with a 43% drop in net sales at Rs.348 crore   and net profit of Rs.72 lakh v/s loss of Rs.21 crore in FY15.

In early April’16, the company announced that mining activities, at Surjagarh Iron Ore mines at Gadchiroli leased to the company,  which were suspended due to Force Majeure has been resumed. The iron ore material from the mine has started coming to the factory. This will be a big positive in Q1FY17 numbers.