Maruti Q4 Net Skids 35%, but Posts Best-ever Yearly Profit
The country’s largest passenger car maker, Maruti Suzuki Limited (MSL) on Friday reported a 35.46% fall in net profit at `800.05 crore for the fourth quarter (Q4) of FY14 when compared to Rs 1,239.62 crore recorded in the same quarter last fiscal.
However, its consolidated net profit was up 15.53% to Rs 2,852.92 crore in FY14 when compared to Rs 2,469.28 crore in 2012-13.
“Lower volumes, higher sales promotion expense and a stock compensation to dealers owing to reduction in excise duty (exceptional expense) impacted the company’s bottom line during the quarter,” MSL Chairman RC Bhargava said in a statement.
The compensation to dealers worked out to Rs 143 crore.
The company’s cost reduction and localisation initiatives, together with favourable foreign exchange, helped improve profit margins despite tough economic conditions.
“Overall, despite a declining market, we could increase our annual profit on the back of our cost reduction and localisation initiatives, together with favourable foreign exchange,” Bhargava said.
The company’s board recommended a dividend of Rs 12, or 240 per cent, per share of face value Rs 5 each for 2013-14.
Maruti Suzuki’s exports in FY14 were down at 101,352 units from 120,388 units previously.
The company has reported many months of consecutive decline in passenger car sales. Adding to this, it had also recalled over one lakh units of their Ertiga, Swift and Dzire models due to a faulty fuel neck filler in April 2014.
Net sales for the quarter under review was down 9.48% at Rs 11,818.13 crore when compared to `13,056.26 crore recorded in the same period a year ago.
Volumes were down 5.48% to 3,24,870 units in the quarter when compared to 3,43,709 units in the same period last fiscal.
Annual sales stood at 11,55,041 units, a drop of 1.4 per cent from 11,71,434 units in 2012-13.
MSL shares fell 1.35 per cent to Rs 1,956.05 at the close on the Bombay Stock Exchange.