Ashok Leyland Q3 PAT up 41 per cent

Hinduja Group flagship Ashok Leyland has reported a net profit of Rs 536.50 million (Rs 379.86 million) for the quarter-ended 31.12.2004, registering a 41 per cent rise on year-on-year basis.

While vehicles sold during the quarter rose marginally to 12,831 from12,489 in the corresponding quarter last year, yearly sales turnover has grown 15.79 per cent, to reach Rs 11,433.51 million (Rs 9,874.12 million) and gross operating margin has improved by 21.1 per cent, to Rs1,019.53 million (Rs 841.79 million). With other income contributing Rs 62.24 million (Rs 18.09 million) and financial expenses substantially lower at Rs 18.33 million (Rs 45.1 million), gross profit is up 30.5 per cent, at Rs 1,063.44 million (Rs 814.78 million).

After a depreciation charge of Rs 255.19 million (Rs 232.79 million), profit before extraordinary item and tax of Rs 8.25 million (Rs 581.99 million) is up 38.9 per cent. Extraordinary item (VRS compensation amortised), is higher at Rs 24.15 million (Rs 18.03 million), to give a profit before tax of Rs 784.10 million (Rs 563.96 million). Provision for current taxation and deferred taxation are both higher, at Rs 172.5 million (Rs 123.7 million) and Rs 75.1 million (Rs 60.4 million) respectively.

Commenting on the results, R Seshasayee, managing director, cited shift in product-mix and pricing action compelled by input cost increases as two major factors that contributed to improved turnover. He added, "We have countered pressures on margins with price corrections as also cost containment through e-sourcing and value engineering. Low cost funds availability thanks to our FCCN issue has helped us reduce financial costs nearly by 60 per cent."
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"We have realised the capacity enhancement effected almost entirely through productivity-linked settlements at our Bhandara and Hosur I units, enabling a record output of over 5,600 vehicles in December 2004. Market has remained buoyant and operations continue to be at full capacity utilisation," Seshasayee added.

The company's sales turnover for April - December 2004 has grown 19 per cent, and stands at Rs 31,340.16 million (Rs 26,340.62 million). Net profit for the nine months, at Rs 1,286.48 million (Rs 1,062.58 million), is up 21.1 per cent.