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| Apollo Tyres Q1 net zooms 95%, declares dividend |
| Press Trust of India / Kochi Jul 23, 2009, 17:14 IST |
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Apollo Tyres has recorded a net profit of Rs 94.7 crore from its India operations during the April-June quarter of 2009-10 fiscal.
This was a 95 per cent increase during the same period last year when the net profit was Rs 48.6 crore, a company press release said today.
Operating profit was Rs 194.8 crore in the first quarter. The board also approved the 45 per cent dividend at the company's 36th annual general meeting.
The first quarter net sales touched Rs 1,180 crore from Rs 1,076 crore during the same period last year.
Speaking on the results, Apollo Group Chairman Onkar S Kanwar said: "Revival in India's economic health has resulted in 5 per cent higher production in India, compared to the same quarter last year. We hope this trend will continue."
"But what is heartening is a bettering of internal efficiencies and improved current asset management, leading to a healthy bottomline. Throughout the year we have been working on our cash and cost management, which is finally showing in the results.
Consolidated first quarter revenues from its India and International operations grew 24 per cent to reach net sales of Rs 1,635 crore as against Rs 1,322 crore the previous year.
Kanwar said the company's continuing attention to increase efficiencies across the board and re-aligning costs to protect margins have paid high dividends. This has assisted in improving margins and to remain competitive, he said.
In specific terms, Apollo Tyres India Operations has reduced the number of days of raw material inventory by 37 per cent and finished goods stocks by 15 per cent and a 40 per cent decrease in the number of days for current debtors, he said.
Efficient inventory and cash management,along with higher production and offtake in both institutional and replacement sales in the first quarter of the year has enabled the company make a positive beginning in the 2010 fiscal, he said.
The board today also reviewed the progress of the Chennai greenfield project, where production is expected to begin towards the end of this calendar year. The plant capacity is 8,000 passenger car radials and 3,000 truck-bus radial tyres per day.
Apollo Tyres would also increase the production capacity of its largest facility in Baroda to 16,000 units per day by the end of the fiscal from the current figure of 11,000 units, Sarkar said.
Asked about the company's recent acquisitions of Dutch tyre maker Vredestein, Sarkar said: "The formal take over was completed on May 15 and the integration process is currently on. We are looking at achieving the correct synergy to plan some project roll outs from Vredestein."
He said the company is focusing on consolidation of the acquisition and not looking for any more deals in the near future.
"Our priority is to consolidate in the three major markets where we exist — India, Europe and Africa. As part of it, we are looking at launching the Apollo brand in Europe and the Vredestein brand in India," he added.
Sarkar, however, refused to disclose the investment made by Apollo in the acquisition of the Netherlands-based company.
Besides, Apollo Tyres is targeting a total turnover of Rs 6,000 crore in this fiscal, he said.
The company had a consolidated net sales of Rs 4,984.07 crore in 2008-09.
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