Escorts Kubota (ESCORTS) Q4 00/01 earnings summary

Executive summary

• FY ended Mar. 31, 2001 total income rose to Rs.1,578.84cr from Rs.1,570.01cr; PBT and PAT declined to Rs.121.39cr and Rs.107.39cr, respectively.

• Strategy shifted toward agri machinery, cellular telephony and healthcare, with plans to exit or sell stakes in businesses that could not deliver sustainable growth.

• Tractor sales volume fell, while growth in combines, cellular subscribers and hospital activity supported selected businesses.

Financial highlights

• Sales and business income was Rs.1,463.24cr versus Rs.1,474.49cr; total income was Rs.1,578.84cr versus Rs.1,570.01cr.

• PBT was Rs.121.39cr versus Rs.142.35cr; PAT was Rs.107.39cr versus Rs.112.35cr.

• Other income was Rs.115.60cr versus Rs.95.52cr, including Rs.103.91cr net surplus on investment sales, mainly the Yamaha Motor Escorts stake sale.

• Interest expense rose to Rs.61.18cr from Rs.52.54cr; depreciation, net of reserve transfer, was Rs.38.78cr versus Rs.35.38cr.

• Loans declined to Rs.617.58cr from Rs.743.28cr; shareholders’ funds increased to Rs.1,022.68cr from Rs.983.28cr.

Outlook and guidance

• Tractor-industry volume was expected to remain flat in the current year; the plan was to gain share through wider product coverage, promotion and sales efforts.

• Railway brake-block project sales were expected to more than double and exceed Rs.20cr; Rexlok fastening systems were scheduled to start in Q2 of the current year.

• Hospital expansion in Delhi and Faridabad and new hospitals in Amritsar and Jaipur were planned; the latter two were targeted within two years.