The company recorded a 16.63 per cent drop in net profit from Rs 4.57 crore to Rs 3.81 crore. The drop in net profit is mainly due to a fall in net sales and jump in interest cost. Net sales fell by 2.5 per cent from Rs 45.14 crore to Rs 44.01 crore. The company's decision to discontinue Duracell battery distribution has affected its sales growth. The company, however, has taken up the distribution of Braun and selected range of Luxov/Parker writing intruments. The fall in net sales has resulted in a 10 per cent drop in operating profit from Rs 7.68 crore to Rs 6.91 crore.

The expenditure saw a marginal fall of 0.96 per cent. The margins at net level suffered as the interest costrose sharply by almost 43 per cent from Rs 35 lakh to Rs 50 lakh. Net profit would have fallen further had there not been a 27.12 per cent drop in provision for tax from Rs 59 lakh to Rs 43 lakh. On an equity base of Rs 12.87 crore, the annualised EPS works out to Rs 11.9. The company has a reserves of Rs 58.2 crore as on December 31, 1998. The company does not foresee any problem on the Y2k front.