Vedanta group firm Sesa Goa today reported a little over 99% plunge in net profit to a meagre Rs 1.28 crore for the second quarter ended September 30, 2011, due to lower realisation from iron ore and foreign exchange losses.
The company had reported a net profit of Rs 384.94 crore in the July-September quarter of 2010.
Total income of the company also declined by 16.63% to Rs 855.10 crore during the quarter vis-a-vis Rs 1,025.71 crore in the same of FY11, it said in a filing to the Bombay Stock Exchange (BSE).
The company incurred a loss of Rs 234.09 crore on foreign currency exchange during the quarter under review as compared to a net gain of Rs 37.65 crore of the corresponding period of last year, it said.
Besides this, the revenues from its core business, sales of iron ore, also went down by 16.44% at Rs 594.29 crore in July-September quarter, as it had to shut down its mine in Karnataka's Chitradurga district, following a Supreme Court ban on mining in the state in August.
The company had reported a total revenue of Rs 711.17 crore from iron ore business in Q2 of last fiscal.
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For the half year ended September 30, 2011, consolidated net profit of the company went down by about 50% at Rs 841.87 crore vis-a-vis Rs 1,686.73 crore of the corresponding period last year.
The filing said that "exchange loss on foreign currency loans adversely impacted the results of the current quarter, while the operating results, excluding the same, is in line with that of corresponding quarter of the previous year".
"The Supreme Court, on August 26, 2011, ordered a ban on iron ore mining and its direct sales in Karnataka. The court has currently ordered a study by government agencies and has also allowed the sale of inventory by e-auction through appointed agency.
"In view of the seasonality of the business, the results for quarter may not be indicative of the full year's performance of the company," the filing added.
The company has inventories of iron ore, pig iron and metallurgical coal worth Rs 919.74 crore in July-September quarter, it added.
Shares of the company settled at Rs 210.90 apiece on the BSE, up 0.81% from the previous close.