Maharashtra Scooters (MAHSCOOTER) Q4 01/02 earnings summary

Executive summary

• Scooter demand weakness and continued customer migration to motorcycles drove a 40% drop in sales and other income to Rs.1,313 million; production fell 34% to 60,216 scooters.

• Profit before tax rose to Rs.44.3 million from Rs.23.7 million, while reported profit for the year reached Rs.53.3 million, including a Rs.9.0 million deferred-tax credit.

• Directors recommended a dividend of Re.1 per equity share, equal to 10% of face value and absorbing Rs.11.43 million if approved.

Financial highlights

• Sales including excise duty fell to Rs.1,200.2 million from Rs.2,070.9 million; sales and other income declined to Rs.1,313.2 million from Rs.2,174.3 million.

• Profit before tax was Rs.44.3 million versus Rs.23.7 million; profit for the year was Rs.53.3 million versus Rs.23.7 million.

• Profit available for appropriation was Rs.50.4 million after Rs.2.9 million of prior-year tax provision; Rs.11.43 million was proposed for dividend and Rs.39.0 million transferred to general reserve.

• Gross profit before interest and depreciation was Rs.67 million; interest expense was Rs.0.7 million and depreciation was Rs.21.8 million.

Outlook and guidance

• Outlook was described as uncertain and difficult to predict; continued marketing efforts and frequent model changes were considered necessary to match customer requirements.

• A potential restructuring path was to integrate operations more closely with Bajaj Auto to avoid additional sales tax on CKD packs; discussions on a possible sale of WMDC’s 27% stake were ongoing.