Aided by improved cost management, operating margins scaled up to 36 per cent from 34 per cent in the same period last year.

Net sales during July-September rose 6 per cent to Rs 203.4 crore, from Rs 191.8 crore in the same period last year, while gross sales were up 9 per cent to Rs 241.6 crore during the period.

Net profit before tax recorded a marginal 2 per cent rise from Rs 16.69 crore to Rs 17.02 crore. The company's operating profit was 13 per cent higher at Rs 72.9 crore, up from Rs 64.7 crore during the corresponding period last year. Cash profit at Rs 45.2 crore was 9 per cent higher as compared to the first quarter of 1997-98.

"Our strategy to reduce costs on all fronts have contributed significantly in improving the operating margins despite lower cementprices," the company said.

Interest charges shot up to Rs 27.7 crore from Rs 23.2 crore, while provision for depreciation was higher by 14 per cent to Rs 28.2 crore during the period.

During the first quarter, Gujarat Ambuja Cements sold 1.17 million tonnes of cement, as against 0.97 million tonnes last year. Average realisation per bag, however, was lower at Rs 87 per bag as against Rs 99 per bag last year.

"The first quarter (July-September) of the company comprises of monsoon months and as such not reflective of the full financial year. Despite difficult scenario prevailing in the cement industry, the company's performance is noteworthy," the statement added.