Tata Motors (TMCV) Q4 09/10 earnings summary

Executive summary

• FY10 consolidated revenue rose 30.5% to ₹92,519.25 crore; profit for the year was ₹2,571.06 crore versus a ₹2,505.25 crore loss in FY09.

• Domestic vehicle demand rebounded, supporting record domestic sales of 633,862 units, up 34%; JLR also recovered, with 193,982 wholesale units.

• Standalone EBITDA margin improved to 11.7% from 6.8%; operating leverage, cost reductions and investment-sale gains contributed to the turnaround.

Financial highlights

• Standalone net revenue, excluding excise duty, rose 38.9% to ₹35,593.05 crore; PBT increased 179.1% to ₹2,829.54 crore and PAT rose 123.7% to ₹2,240.08 crore.

• Consolidated PBT was ₹3,522.64 crore versus a ₹2,129.25 crore loss; PAT was ₹2,571.06 crore versus a ₹2,505.25 crore loss.

• Consolidated profit before interest, depreciation, amortisation, exceptional items and tax was ₹10,407.28 crore, up from ₹2,995.46 crore.

• Standalone PBT included ₹1,112.51 crore profit on sale of a controlling stake and an ₹850.86 crore loss on preference-share redemption.

• Consolidated other income included ₹1,057.92 crore profit on the Telcon stake sale; lower JLR residual-value provisions also supported expenses.

Outlook and guidance

• FY11 global growth was expected to exceed 4%; Indian GDP growth was forecast at 8.8% by the IMF, supporting domestic automotive demand.

• Higher infrastructure spending and industrial production were expected to support commercial vehicles; JLR key markets China, Russia and the Middle East were expected to grow.

• Priorities included new products and variants, aggressive cost reduction, international-market expansion, and JLR cost improvements and emerging-market growth.

• Sanand began commercial production in April 2010; initial Nano capacity is 250,000 units annually, expandable to 500,000.