Telco Posts Rs 28-crore Net Profit In June-quarter

Mumbai, July 25: | Updated: Jul 26 2002, 05:30am hrs
Tata engineering & Locomotive Company Ltd (Telco) reported a net profit for the second consecutive quarter ended June 30, 2002, after having incurred losses for seven quarters till December 2001.

For April-June 2002, Telco posted a net profit of Rs 28.03 crore, against a net profit of Rs 161.68 crore in the fourth quarter of 2001-02 and a loss of Rs 98.9 in the first quarter of 2001-02.

The company’s executive director (finance & corporate affairs) Praveen Kadle said the performance in the first quarter of 2002-03 was the best in the last five years as revenues jumped 23 per cent to Rs 2,087.24 crore from Rs 1,697.38 crore a year earlier.

Mr Kadle said reduction in material costs, better product mix and improved price realisations across all segments helped the company raise its operating margins to 11.5 per cent from 8.9 per cent.

The company’s operating profit rose to Rs 201.42 crore in April-June 2002 from Rs 126.25 crore a year earlier.

Mr Kadle said the company aims to be back in black for the full year in 2002-03.

Mr Kadle said Telco brought down net interest cost by 22 per cent to Rs 80 crore during the quarter from Rs 102.05 crore a year earlier, having prepaid or restructured expensive debt amounting to Rs 75 crore.

He said the company achieved a cost reduction of Rs 67 crore during the first quarter of the current fiscal.

During April-June 2002, there was no charge towards amortisation of deferred revenue expenditure and employee separation costs, consequent to the adjustment of the unamortised balances as of March 31, 2002 against securities premium account.

Telco’s total vehicle sales in the first quarter of 2002-03 was up 16 per cent to 40,766 units, with commercial vehicle volumes rising 46 per cent to 21,376 units. The company’s executive director (passenger cars) V Sumantran said Tata Indica maintained its market share at 11 per cent during the first quarter despite the planned shutdown in the assembly line and power problems at its pune plant.

Mr Sumantran said Indica was back in the leadership position in the compact segment with June 2002 sales volume of 7,056 units, as production was back on track during the month.

He said the company maintained its operating margin for Indica at 7 per cent. The global benchmark for operating margin in passenger cars is 9 to 10 per cent. Telco executive director Ravin Kant (commercial vehicles) said sales of commercial vehicles in the quarter increased by 45.7 per cent to 21,376 units, which represents increase in market share to 55 per cent from 52 per cent.