7:30PM Mumbai - Hindalco Industries revenue fell for the third quarter ended December 2007; the rising rupee is expected to affect profit margins.

Third Quarter Earnings Review

Hindalco Industries Ltd., the flagship company of the Aditya Birla Group, said that its net sales and operating revenues amounted to 4,531.7 crore rupees during the quarter ended December 2007, down from 4,656.2 crore rupees in the corresponding period a year ago.

In the quarter, net profit declined to 542.7 crore rupees from 643.9 crore rupees a year ago.

Hindalco Industries said earning per share stood at 4.4 rupees, down from 6.5 rupees per share in the same period a year earlier.

Nine-Month Earnings Review

In the nine months, Hindalco Industries earnings per share stood at 15.6 rupees versus 18.7 rupees per share during the comparable period a year ago.

Net profit declined to 1,788.4 crore rupees from 1,843 crore rupees a year earlier while net sales and revenue in the same period rose to 14,169.3 crore rupees from 13,564.1 crore rupees in the same period a year ago.

Revenues and Profits

Of the total revenues of 4,531.7 crore rupees, the aluminum business contributed 1,729 crore rupees. In the quarter, sales for aluminum metal surged 12% along with higher proportion of value added products.

Profit before interest and tax for aluminum business was at 578.9 crore rupees compared with 755.5 crore rupees in the corresponding quarter last year due to the rising rupee and a decline in global alumina realisation.

Revenue from copper business was at 2806.2 crore rupees lifted by higher sales volumes and an enriched product mix.

Profit before interest and tax stood at 94 crore rupees versus 159.5 crore rupees in the same quarter last year.

Operational Review

In the period, the aluminum plants operated at consistently high capacity utilization. Brownfield expansions have resulted in 9% higher metal production

The company said copper cathodes and CC rods production rose 7% and 38% respectively, due to the ramp up of the copper-III smelter and consistent production from smelter-I.

Project Expansion

Hindalco Industries said about six expansion projects are at various stages of implementation.

Outlook

Going forward, the company said higher volumes from asset sweating of existing plants, the brownfield expansions and continued cost focus together with effective working capital management to maximise free cash flow will be the major growth drivers.