Gabriel India (505714) Q4 97/98 earnings summary

Executive summary

• FY98 sales edged down amid a downturn in the economy, particularly in the automotive sector; profit after tax fell by more than half as interest and depreciation charges rose.

• Export sales grew 38%, supported by an agreement with Arvin for supply of Ride Control Products to its worldwide distribution network.

Financial highlights

• Sales were Rs. 205.91 crore versus Rs. 207.50 crore in FY97; profit before interest and depreciation was Rs. 34.63 crore versus Rs. 35.70 crore.

• Profit before tax was Rs. 7.71 crore versus Rs. 16.03 crore; profit after tax was Rs. 6.83 crore versus Rs. 13.94 crore.

• Net interest rose to Rs. 19.35 crore from Rs. 14.92 crore; depreciation increased to Rs. 7.57 crore from Rs. 4.75 crore.

• Export sales increased to Rs. 19.88 crore from Rs. 14.46 crore; domestic sales were Rs. 186.03 crore versus Rs. 193.04 crore.

Outlook and guidance

• Ride Control capacity was expanded to 10 million shock absorbers p.a.; new-generation Shock Absorbers and Struts were under development for domestic and export markets.

• Stallion Shox expected to begin OEM commercial supplies from September 1998; its first export shipment was planned for May 1998.

• A Pune product-validation centre was expected to become fully operational shortly, supporting testing and product improvement across Ride Control plants.