Pantaloon Retail Q3 net down 98%

The company's consolidated net profit for corresponding quarter of last year was Rs 4.09 crore.

Pantaloon Retail India Ltd (PRIL) today reported 98.53 per cent decline in consolidated net profit for the third quarter ended March 31,2012 at Rs 6 lakh due to increase in interest costs.

The company’s consolidated net profit for the corresponding quarter of last year was Rs 4.09 crore. During the third quarter of this year,the company had minority interest cost of Rs 14.28 crore,compared to Rs 1.15 crore in the previous year,it said in a statement.

PRIL’s consolidated net sales increased 11.86 per cent to Rs 1,105.94 crore,against Rs 988.68 crore in the third quarter of last year.

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In a meeting held today,PRIL’s board approved transfer of its ‘Home Town’ division into a wholly-owned subsidiary of the company.

Launched in 2007,Home Town is retail format that sells products and services for home building and improvement.

“In order to manage the scale,expand at a faster pace and bring in requisite investments,the company has decided to form a wholly-owned subsidiary that owns and operates this business,” PRIL said in an investor presentation.

The network now has over 38 stores in 20 cities and is also focusing on growing the institutional business and penetrating Tier II and III cities,which is dominated by unorganised players,it said.

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During the quarter under review,PRIL announced its plan to demerge its Pantaloons retail chain business and partner with Aditya Birla Nuvo Limited (ABNL).

ABNL intends to acquire at least 50.01 per cent stake in the business by subscribing to debentures worth Rs 800 crore and through an open offer post demerger.

“This transaction will help reduce the company¿s debt by Rs 1,600 crore,” it said.

In a separate deal,BCCL — an existing shareholder of the company,is subscribing to a preferential share allotment in the company at Rs 245 per share for a total sum of Rs 200 crore.

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PRIL is also proposing to sell its entire 53.67 per cent stake in its subsidiary,Future Capital Holdings Ltd (FCH),through a block deal on the stock exchange to its wholly-owned subsidiary Future Value Retail Limited (FVRL).

“The company has reiterated its intention of monetising some of its investments in financial services businesses by the end of this financial year,” it said.

During the quarter,the company added 0.51 million square feet of total retail space,resulting in a total operational retail space of 16.33 million square feet.

PRIL’s scrip closed at Rs 147.20 per share,down 2.45 per cent from the previous close on the BSE.