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The company arranged for payment of the agreed cane prices in full for the year 2014-15, inspite of the adverse environment on sugar prices. It has also put together a loss reduction plan for the rest of the year, it said.
"However, without government intervention with subsidy on exports and policy announcement linking cane price to sugar prices, we see difficult days ahead this year," said V Ramesh, managing director of the company. "This quarter has been the most challenging one, in recent times," he added.
Murugappa Group firm EID Parry's net loss has widened to Rs 192.79 crore during the quarter ended June 30, 2015, on a consolidated basis, as compared to net loss of Rs 43.8 crore posted during the same period of previous fiscal year. The total income from operations grew by nine per cent to Rs 2805.6 crore during the three months ended June 30, 2015, as against Rs 2,573 crore in the corresponding quarter of last year.
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The average sales realisations of Sugar in EID Parry declined by 13 per cent in the first quarter of 2015-16 as compared to the previouis quarter. As a prudent measure, we have devalued the sugar stocks to reflect the actual sales realisations of the first quarter and early July.
"Consequently, the unprecedented progressive steep drop in sugar prices, due to surplus production in India, has completely eroded profitability and taken us into the red," said the company official in the company's quarter result announcement.
