Mercator Lines profit dips 4%

BS 200 SCORECARD

The Mumbai-based Mercator Lines has reported 3.63 per cent decline in profit at Rs 56.21 crore during the third quarter ended December 31, 2005 against Rs 58.33 crore recorded during the corresponding period of the last year.

Income from the operations grew to Rs 196.40 crore during the reporting quarter against Rs 168.78 crore in the comparable time last year.

Company executives said that the marginal decline is due to substantial increase in interest (255 per cent) and depreciation (185 per cent) cost coupled with higher tax provision of 197 per cent.

Analysts said the company, the second largest private sector shipping company operating in the liquid and dry bulk segment, did not record profit on sales of assets during the reporting quarter while the corresponding period of the last year witnessed profit on sales of assets at Rs 2.37 crore.

At the company's recently held extraordinary general meeting, the shareholders approved issue of bonus shares in the ratio of 3:2 (three shares for every two shares held), as also for issuance of securities by public/private offering in the domestic and/or international markets, in the form of ADR/GDRsond/equity shares or in any other form for an aggregate amount not exceeding $75 million or the equivalent amount in any currency.

The company also plans to issue 32 lakh warrants carrying entitlement/option to apply for equal number of equity shares, on preferential basis to the promoter's group/associate company, namely AHM Investments Pvt Ltd, in accordance with Sebi guidelines for the preferential issue.