The Hindu Business Line : McLeod Russel full-year net jumps to Rs 88 cr

Kolkata, June 3 Riding high on improved performance, the board of McLeod Russel India Ltd, the largest producer of tea in the country, at a meeting here on Wednesday recommended 40 per cent dividend (Rs 2 per share of Rs 5 each) for the year ended March 31, 2009.

The company had paid 20 per cent dividend (Re 1 a share) in 2007-08.

The operating profit at Rs 206.73 crore (Rs 83.33 crore) showed 148 per cent growth, net profit (standalone) at Rs 88.79 crore (Rs 47.21 crore), a growth of 88 per cent and net profit (consolidated) a growth of 80 per cent.

During the year under review, the company produced 74.8 million kg of tea (74.4 mkg) and sold 74.5 mkg (75.1 mkg).

Mr Aditya Khaitan, Managing Director, while talking to newspersons here on Wednesday, sounded bullish about the company’s performance in the current fiscal due to several reasons such as the upsurge in demand for tea with no corresponding increase in production to meet the increased demand, thus leading to higher prices.

Till March (i.e. from January to March) the shortfall in crop was six mkg which jumped to 18 mkg in April. The average price of North India tea now was up by about Rs 25 to 30/kg over the price levels in the same period of last year, he said.

In 2009-10, the company’s production too would be close to 84 mkg, with addition of 4.5 mkg from Phu Ben tea garden in Vietnam.

“The trend so far in the current year appears to be good and we expect higher average price realisation,” he observed pointing out that the company’s average selling price was Rs 111.03/kg in 2008-09 as compared to Rs 87.21/kg in 2007-08. The company’s financial performance in the current year, as Mr Kamal Baheti, Director (Finance), pointed out, would improve also because the net debt burden would get further reduced by Rs 50-100 crore from Rs 390 crore; the probable lowering of interest rate would reduce the interest burden and the company would stand to benefit from exchange fluctuations on foreign currency loan.

Asked if McLeod was looking for new acquisitions, Mr Khaitan replied that the time was now for consolidation. “The timing of our acquisition in past few years was perfect and we benefited from the price increase,” he added.

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McLeod Russel net up on tea price boom

More Stories on : Dividend Announcement | Tea

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