Apollo Tyres (APOLLOTYRE) Q4 01/02 earnings summary

Executive summary

• FY02 sales from operations reached ₹1,710.14 crore, up 17.56% YoY; reported overall growth of 18% versus 2% industry growth.

• Higher production, manufacturing efficiencies, working-capital management, marketing and cost reduction supported improved profitability.

• Truck tyre replacement leadership and new farm radial products strengthened the market position; capacity expansion and radialisation initiatives were underway.

Financial highlights

• Sales and other income were ₹1,712.75 crore versus ₹1,458.70 crore in FY01; operating sales were ₹1,710.14 crore versus ₹1,454.70 crore, up 17.56%.

• Operating profit before interest and depreciation rose to ₹141.22 crore from ₹113.83 crore; profit before tax was ₹54.75 crore versus ₹25.49 crore.

• Standalone net profit after tax was ₹36.81 crore, up 44.81% YoY from ₹25.42 crore; basic and diluted EPS was ₹10.14 versus ₹7.00.

• Tyre and tube production increased 13.18% to 1.46 lakh tonnes from 1.29 lakh tonnes, reflecting productivity gains and better machine utilisation.

Outlook and guidance

• Plant expansion within existing facilities was expected to be completed by Q4 FY03 to address the demand-supply gap.

• A pilot truck radial facility at Baroda was planned; passenger car and LCV radial capacity was also being increased as market preference shifted toward radial tyres.

• Higher freight movement was expected to support truck tyre demand; leadership in the truck tyre segment was positioned to benefit.

• Strategy focused on consolidation, cost optimisation, customer initiatives and strengthening market position; firming natural rubber prices could pressure margins.