Tata Motors consolidated net profit falls
15 November 2014
Tata Motors, the country's largest automaker, has posted a 7.1 per cent fall in consolidated net profit at Rs3,291 crore in the second quarter ended 30 September, weighed down mainly by weak Indian operations. The drop was also due to tax reversals.
In comparison, the company had posted a net profit of Rs3,542 crore during the same quarter of the previous financial year.
''As far as India business is concerned we had some tax reversals… This is more of accounting provision and not cash,'' Tata Motors Chief Financial Officer C. Ramakrishnan said.
The company made a higher tax provision of Rs2,364 crore for the quarter, more than double the expense it accounted during the same period of last year.
The company's consolidated profit before tax rose 19.2 per cent to Rs5,671 crore, compared with Rs 4,756 crore it had posted during the same period of the previous financial year.
Tata Motors' net sales for the reporting quarter rose 6.5 per cent to Rs60,564 crore, compared with Rs 56,867 crore posted during the year-ago quarter. EBITDA margin improved to 17 per cent at the consolidated level from the earlier 16.3 per cent.
The company's India business posted a loss of Rs1,845.63 crore during the quarter under review, as against Rs803.53 crore posted in the year-ago quarter on a total income of Rs8,750 crore (Rs8,868.4 crore).
The company's British subsidiary Jaguar Land Rover (JLR), which was acquired in 2008, also posted a fall in net profit. The company's net profit fell to £450 million during the quarter under review, from £507 million posted during the same period a year ago.
The company's revenues rose 4.2 per cent to £4,808 million (£4,612 million) on a rise in vehicle sales during the quarter.
''As far as JLR is concerned there are two effects happening. One is certain amount of higher tax provisioning in JLR and more importantly as JLR launches new products the depreciation and amortization charged in JLR is also growing,'' Ramakrishnan, said adding there was a marginal effect of foreign exchange revaluation.
"We will start assembly from the China plant with the rollout of the Land Rover Evoque this year and another model from next year," JLR Chief Financial Officer Kenneth Gregor said, adding the Brazil plant will go on-stream by 2016.