MRF Profits Down in Q3 Despite Increased Sales

Increasing raw material and personnel costs are said to be two of the key factors behind lower net profits for India’s MRF in the financial year’s third quarter. In the three months to June 30, 2008 the Chennai based company experienced a 25 per cent drop in net profits from the corresponding quarter a year earlier, to Rs 318.6 million (£3.74 million). Net profits for the nine months of the current financial year stand at Rs 1.492 billion (£17.5 million), an increase of 39.2 per cent.

This decline in net profit occurred in spite of increased net sales in the quarter. At Rs 12.743 billion (£149 million), net sales were up 12.4 per cent. The company reports in its unaudited result that, during the quarter, it experienced a 26 per cent increase in raw material consumption, while staff costs increased by 29 per cent. Depreciation and interest costs also rose by 14 per cent and 32 per cent respectively during the third quarter.