Ashok Leyland Net Rises 72 Per Cent Higher In Q3 On Lower Expenses

Chennai, January 24: | Updated: Jan 25 2003, 05:30am hrs
Aided by a change in accounting procedure relating to voluntary retirement scheme (VRS) expenditure and lower financial expenses, Ashok Leyland Ltd has reported a 72.3 per cent jump in net profit to Rs 23.28 crore for the third quarter ended December 2002, as against Rs 13.51 crore during the corresponding period last year. The net profit would have lower by Rs 6.61 crore at Rs 16.67 crore but for a change in company policy to adjust the VRS expenditure against the share premium account instead of amortising it over a three year period.

Income from operation grew by 24.7 per cent to Rs Rs 659.69 crore (Rs 528.69 crore) with a sales volume growth of 27 per cent to 7,776 vehicles (6,134 vehicles). After a rather long lull, we already see signs of revival in demand from the southern and western regions, especially for multi-axled vehicles. This should favourably impact the last quarters sales, said Mr R Seshasayee, managing director, ALL, in a press release. We have completed the launch of the model 1612 with H engine in north and south. In both the regions, the product has been received well, on expected lines. The rest of the country will be covered in the next three months, which should boost our sales for the rest of the year, he added.

The 16-Tonne truck has been launched with the fuel efficient Hino engine and branded as the H series. Meanwhile, total expenditure was at Rs 587.74 crore (Rs 450.55 crore). Other income chipped in Rs 1.26 crore (Rs 0.02 crore) to the bottomline. Financial expenses were lower by 44 per cent at Rs 12.86 crore (Rs 23.15 crore).

Depreciation was marginally higher at Rs 24.18 crore (Rs 23.80 crore). Provision for taxation stood at Rs 12.85 crore (Rs 8.14 crore). Paid-up share capital remained unchanged at Rs 118.92 crore. Earnings per share for the quarter increased to Rs 1.96 (Rs 1.14). For the nine months ended December 2002, the company has reported a sales of Rs 2027.61 crore (Rs 1749.19 crore) and a net profit of Rs 53.87 crore (Rs 22.62 crore). Vehicles sales during the period stood at 23,587 units (19,823 units).

Among other things, the stock fell by 2.5 per cent to Rs 96.50. About 2.24 lakh shares changed hands on the National Stock Exchange. The results were announced during the trading hours on Friday.

The results are in line with the market expectation but for the cosmetic change in terms of treatment of VRS expenditure. There has been some mild profit booking after the announcement of the results, said an analyst with a domestic brokerage house.