Gabriel India (505714) Q4 98/99 earnings summary

Executive summary

• FY99 sales rose to Rs 207.62 crore from Rs 205.91 crore, but the automotive downturn, higher interest and depreciation, and margin pressure drove a net loss of Rs 1.89 crore versus profit of Rs 6.83 crore.

• Ride Control Products grew, while Engine Bearings weakened sharply; Stallion Shox increased turnover and narrowed its loss but remained loss-making.

• Recommended dividend fell to Re 1.00 per share from Rs 2.50.

Financial highlights

• Sales Rs 207.62 crore vs Rs 205.91 crore; profit before tax was a loss of Rs 1.87 crore vs profit of Rs 7.71 crore.

• Profit after tax was a loss of Rs 1.89 crore vs profit of Rs 6.83 crore; profit before interest and depreciation was Rs 30.34 crore vs Rs 34.63 crore.

• Net interest rose to Rs 22.48 crore from Rs 19.35 crore; depreciation increased to Rs 9.73 crore from Rs 7.57 crore.

• Exports of Ride Control Products and Engine Bearings totaled Rs 19.63 crore, down from Rs 19.88 crore.

Outlook and guidance

• Ride Control capacity expanded to 10 million shock absorbers and struts annually, positioned to serve demand as the economy recovers.

• Engine Bearings initiated corrective measures to improve operating efficiency and make increased capacity available for domestic and export demand.

• Y2K program targeted major system repairs and most testing by August 1999; significant costs were not expected.

• Product development plans include shock absorbers, McPherson struts, cartridges, bearings, modules and systems for domestic and export markets.