Lml Net Up 17%, Payout At 15%

The Kanpur-based scooter manufacturer LML Ltd has reported a 17.33 per cent rise in its net profit against a 20.97 per cent increase in the total sales turnover for the year ended September 30, 1997.

While the company sales rose to Rs 748.72 crore in the financial year October 1996-September 1997 from Rs 618.91 crore in the last fiscal, its net profit rose to Rs 20.30 crore from Rs 17.31 crore during the same period. The board of directors also approved the payout of a maiden dividend of 15 per cent for 1996-97, amounting to a total payout of Rs 6.84 crore.

 

The board of directors of the company met yesterday in New Delhi to take on board the annual accounts of the company in the silver jubilee year. The lower increase in net profit, against a 55.09 per cent rise in gross profit (from Rs 55.91 crore to Rs 86.71 crore) has been consequent to the company writing off as an extra-ordinary loss against group company Esslon Synthetics Ltd for the second consecutive year.

The loss arose out of the non-recovery of the unsecured sales consideration from Esslon Synthetics.

LML wrote off Rs 21.94 crore against Esslon for 1996-97 financial year, while Rs 9.1 crore was written off against the company for 1995-96.

In spite of the interest burden rising from Rs 16.45 crore in 1995-96 to Rs 21.83 crore in 1996-97, the cash profits of the company rose by 64 per cent to touch Rs 64.88 crore in 1996-97 against Rs 39.46 per cent in 1995-96. The performance was buoyed by strong sales of 2,94,648 scooters last year against that of 2,57,037 the previous year, an increase of 14.6 per cent against an industry average growth rate of negative 0.55 per cent. The company board has set a target growth rate of sales and turnover of 20 per cent for 1997-98, and would be working out the detailed marketing and price strategy in the next few weeks.

The company also made provision of taxation to the tune of Rs 4.50 crore last year, against Rs 1.62 crore in 1995-96. The depreciation has been pegged at Rs 18.14 crore, against Rs 10.95 crore of the previous year.

The company recently completed the first phase of its expansion plan by commissioning a new assembly line in October this year.

With the planned capacity increase to 6,00,000 two wheelers per annum by the turn of the century, LML will add scooterettes, scooter and motorcycles in 2-stroke and 4-stroke versions with geared and variomatic transmission variants.