Poor sales hit DLF's profit in Sept quarter

DLF, the country's largest developer, disappointed the Street's expectations of a higher net profit on Wednesday. At Rs 100 crore, the company's net profit for the second quarter of the financial year 2013-14 is 28 per cent lower than the Rs 138 crore in the same quarter in the past financial year, due to lower sales and higher interest and tax outgo. DLF said its consolidated revenue was Rs 2,225 crore for the quarter ended September, up three per cent from Rs 2,157 crore in the year-ago period. Finance cost in the quarter increased to Rs 609 crore from Rs 522 crore in the year-ago period, while tax outgo rose to Rs 85 crore from Rs 39 crore.

Sequentially (compared to the past quarter), net profit is down 45 per cent from Rs 181 crore. The company has not been able to hit its divestment target as it could not sell Aman Resorts, part of its non-core assets, in the period it had expected. Divestment of non-core assets was meant to reduce its debt of Rs 20,500 crore, as of end of June. Aman was bought back by its founder Adrian Zecha in an estimated $300-million deal but the deal could not be completed. The company was able to divest some of its other non-core assets, including the wind energy business and some land parcels.