Escorts First Quarter Net Profit at 10.86 crore
ESCORTS FIRST QUARTER NET PROFIT AT 10.86 CRORE
First Quarter sales at 823 crore Net sales up 7.8% on sequential basis
New Delhi, February 2, 2012: Escorts Limited today reported a Net Profit of 10.86 crore for the first quarter of the 2011-12 financial year ending December 31, 2011. Net sales increased 7.8% sequentially to 823 crore on account of a sequential increase of 9.2% in tractor sales. Escorts Limited follows an October-September fiscal year and the reported quarter is the first quarter of fiscal 2011-12.
The Agri Machinery division recorded revenue of 772.8 crore. Tractor volumes are up 1.7% to 16,606 units as against 16,333 units in the corresponding quarter. The Auto Parts Division showed a growth of 25% though the postponement of large tenders by the Railways to Q 2 resulted in a decline of 28% in sales of the Railways Division. The impact of inflationary pressures resulted in cost of raw materials going up by 2 per cent over the preceding quarter and by 0.7% over the corresponding quarter. The company has raised prices by 7,000/- per tractor in January '12 and this along with cost compression measures, will improve profitability in coming quarters.
Speaking on the results, Chairman and Managing Director Mr. Rajan Nanda said, "Despite a profitable quarter and growth over the immediate preceding quarter, the results reflect the constraints of the current economic environment and the impact of inflation and finance costs. A number of managerial initiatives are underway to meet this challenge. Today, Escorts is embarking on an expansion of its product portfolio, re-gearing product and pricing strategies to meet the aspirations of its customer base with higher dependency on mechanization and undertaking geographic and capacity expansion."
Mr. Nikhil Nanda, Joint Managing Director said, "Our focus is on building a national market base, providing customers a range of crop solutions and implements, PTO and haulage applications for tractors, product upgrades and improvements as well as targeted marketing for non-agriculture usages. At the crux of our approach to the market is the increasing demand for farm mechanization and the accessorized deployment of tractors for non-farm uses. We believe multi-domain growth drivers along with cost compression measures will enable Escorts to deliver profitable growth."
Escorts Construction Equipment continued to demonstrate strong growth, with a sales turnover of 206 crore as against 163 crore in the corresponding quarter of the previous fiscal.
The audited accounts of the first quarter of 2011-12, ending December 31, 2011, has been approved by the Board of Escorts Limited.
Note for Editors: Escorts Limited follows an October-September fiscal year. The results reported are for the first Quarter of Fiscal October 1, 2011 to September 30, 2012.
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