Maharashtra Scooters (MAHSCOOTER) Q4 03/04 earnings summary

Executive summary

• FY04 scooter production fell 43% YoY to 17,900 units and sales fell to 16,935 units amid continued decline in geared-scooter demand; margins remained under pressure.

• Net sales and other income declined 27% to Rs.462.24 million, while reported net profit rose to Rs.60.55 million, largely reflecting a Rs.23.40 million deferred-tax benefit.

Financial highlights

• Net sales were Rs.331.14 million versus Rs.537.87 million; other income was Rs.131.10 million versus Rs.93.73 million.

• Profit before interest and depreciation was Rs.51.65 million versus Rs.33.40 million; PBT was Rs.37.15 million versus Rs.18.28 million.

• Net profit was Rs.60.55 million versus Rs.3.38 million; the current-year result included a Rs.23.40 million deferred-tax asset credit and earlier-year adjustments.

• Other income included Rs.57.78 million of dividends/investment income and Rs.45.88 million net profit on investment sales.

Outlook and guidance

• Outlook was described as uncertain and difficult to predict, with the geared-scooter market shrinking and a new competitor adding pressure.

• Continued product, technology, quality and sales-promotion improvements were identified as important amid the shift in customer preference toward motorcycles.