Suzlon blames low volumes for poor show

Suzlon's lacklusture performance in the first quarter of 2007-08 is due to low volume business during the quarter and appreciation of Indian rupee which impacted the overall performance, according to Tulsi R Tanti, chairman and managing director, Suzlon Energy.

Suzlon reported a consolidated profit after tax (PAT) of Rs 20 crore for the first quarter of 2007-08, 79 per cent down from the Rs 96 crore posted during the corresponding previous quarter.

Sales were at Rs 1,945 crore for the period, 81 per cent up from the previous year of the same quarter results of Rs 1,069 crore. Earnings before interest, taxes, depreciation and amortisation (EBIDTA) was lower at Rs 140 crore, compared with Rs 186 crore in the previous quarter.

The company reported a standalone net profit of Rs 89 crore for the period, 54 per cent down from Rs 194 crore posted during the corresponding previous quarter of 2006. EBIDTA was lower at Rs 113 crore, compared with Rs 239 crore in the corresponding 2006-07 quarter.

Standalone sales were down by 10 per cent at Rs 839 crore for the period, compared with the corresponding previous quarter results of Rs 933 crore, on a consolidated basis.

Tanti said 67 per cent of the revenue comes from export, comparison with the last year's 60 per cent revenues from the domestic market. Historically, the first quarter results only forms 10-15 per cent share of the annual revenues for Suzlon and Hansen. Additionally, with the global wind industry oversold, supply chain bottlenecks were a major challenge for the industry.

He said the company had an outgo of Rs 13 crore as part of the Repower acquisition during the quarter, and the revenues from RePower will be reflected only in the next quarter, as RePower follows a January-December accounting year.

Share prices of Suzlon Energy closed on the Bombay Stock Exchange(BSE) today at Rs 1298.75, down by 7.36 per cent from the Rs 1401.90 at the previous day close.