Arvind Mills net down at Rs 19.2 crore

Ahmedabad-based denim-major Arvind Mills, which has been restructuring its business and debt, has reported a 47.59 per cent drop in net profit for the third quarter at Rs 19.21 crore compared with Rs 36.66 crore in the corresponding period of the previous year. Sales revenue dipped 10 percent to Rs 348.25 crore (Rs 379.31 crore).

Company officials attributed the drop in bottomline to the sustained rise in cotton prices, the appreciating rupee and a drop in sales of denim fabrics. They warned that the cost-push due to the cotton price increase is likely to affect the company's margin for the coming few years.

The operating profit for quarter dipped to Rs 80.44 crore (Rs 107.91 crore). For the nine months of the current year, net profit stands at Rs 71.59 crore against Rs 91.31 crore reported in nine months of the last fiscal year. Sales revenue was at Rs 1085.95 crore (Rs 1088.31 crore).

In an official statement, Arvind Mills officials said the company has recently entered into agreements to source gas as a fuel for its captive power plant as compared to naphtha. This is expected to lower the energy costs from the second quarter of the next fiscal year.