Sector analysts reasoned that the sweeping fall in employee benefit expenses was primarily on account of the payment of one-time increase in gratuity settlement of Rs 7,384 crore.
Taking this into consideration, the total employee benefit expenses rose by 15.47 per cent during the quarter and the pre-tax profit of the company stood at around Rs 1,508 crore during the last three months of the last fiscal year. In the January-March period of the 2017-18 fiscal year, the pre-tax profit stood at Rs. 1,163.35 crore.
“Better average realization in both coal, Fuel Supply Agreement (FSA) and e-auction sales coupled with operational cost control propelled the company to its best ever financial performance. Importantly, coal quality variance was under control and we have been able to arrest the grade slippage to large extent”, a company official said.
Average realisation per tonne of coal in the FSA saw an 8 per cent increase to Rs 1,348 during 2018-19 from the previous level of Rs 1,243 during 2017-18. The overall average realisation per tonne of coal went up to Rs 1,529 during 2018-19 compared to Rs 1,398 on a year-on-year basis.
During the quarter, Coal India sold 142.42 million tonne (mt) of coal via the FSA route which helped it earn Rs 20,794.15 crore while another Rs 4,602.64 crore was earned by selling 16.71 mt of coal via the e-auction route.
Contractual expenses, the second-largest cost overhead, also fell by 1.38 per cent to Rs 3,838.56 crore benefiting the company post higher profits.
A company official said that for the full 2018-19 fiscal year, all the subsidiaries of Coal India had managed to earn a profit.