Earnings Review
Apollo Tyres Jul-Sept earnings miss Street estimates
This story was originally published at 22:28 IST on 13 November 2024
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--Apollo Tyres Jul-Sept consol net profit INR 2.97 bln
--Analysts saw Apollo Tyres Jul-Sept consol net profit INR 3.24 bln
--Apollo Tyres Jul-Sept consol PAT INR 2.97 bln vs INR 4.74 bln year ago
--Apollo Tyres Jul-Sept consol revenue INR 64.37 bln vs INR 62.80 bln yr ago
--Apollo Tyres: Board OKs raising up to INR 10 bln via NCDs
--Apollo Tyres Apr-Sept consol PAT INR 5.99 bln vs INR 8.71 bln year ago
--Apollo Tyres Apr-Sept consol revenue INR 127.72 bln vs INR 125.24 bln
By Steffy Maria Paul
MUMBAI – Apollo Tyres Ltd.'s earnings for the September quarter missed the Street's estimates on both net profit and revenue. The tyre manufacturer's consolidated net profit fell 37.3% on year to INR 2.97 billion in Jul-Sept, missing analysts' estimate of INR 3.24 billion. This is the third consecutive quarter that the net profit has declined and the fall in the September quarter was the highest in the three quarters. Before these three quarters, the company had reported an increase in its net profit for seven quarters in a row.
The company's consolidated revenues rose 2.5% on year to INR 64.37 billion for the quarter, missing the Street estimate of INR 64.90 billion. With the 2.5% growth in the September quarter, the company's consolidated revenue has grown for the last five quarters in a row.
For the first six months of the year, the company reported a consolidated net profit of INR 5.99 billion, down 31% on year. The company reported consolidated revenues of INR 127.72 billion in Apr-Sept, up 2% on year.
In the quarter, Apollo Tyres spent INR 51.76 million on an employee reorganisation exercise, including for employees of its subsidiaries, which it recognised under 'exceptional items'.
The company's other income for Jul-Sept fell 14% to INR 216.70 million. The raw material cost during the quarter was INR 33.35 billion, up 27% on year. The company's finance cost for the quarter was INR 1.2 billion, down 10%. The company's other expenses for the quarter rose to INR 12.33 billion, up 26%. The company's total expenditure for the quarter was INR 60.55 billion, up 8% on year. The company's total expenses have grown for two consecutive quarters after falling for four quarters in a row.
The Gurugram-based company sells its products under the brands Apollo and Vredestein. The tyre manufacturer's revenue from the Asia-Pacific, West Asia, and Africa region for the September quarter was INR 45.66 billion, up slightly from INR 44.73 billion a year ago. However, the profit before tax and finance costs from the region fell 49% on year to INR 3.45 billion. For the six months ended September, the company's revenue from the region was up 3.4% on year while the profit before tax and finance costs from the region was down 38% on year. In this region, apart from India, the company has operations in the United Arab Emirates, Thailand, and South Africa.
The company's revenue from Europe for the quarter was INR 19.29 billion, up from 18.16 billion a year ago. The profit before tax and finance costs from Europe was INR 1.14 billion, up 18.9% on year. For the six months ended September, the company's revenue from this region was up 2.4% on year, while the profit before tax and finance costs from the region was up 15.6% on year.
The company's revenue from other regions, which includes sales in the Americas and to other corporate entities, was INR 17.01 billion, up 67% on year. The profit before tax and finance costs from this region was INR 645.04 million, up from 576.92 million a year ago. For the six months ended September, the company's revenue in the region was up 22.5% on year while the profit before tax and finance costs from the region was up 1.8% on year.
The revenue of the three regions also includes an inter-segment revenue of INR 17.58 billion, the company said.
The company said it will raise up to INR 10 billion through a private placement of non-convertible debentures in one or more tranches, after the approval of shareholders. On Wednesday, shares of the company closed at INR 456.60 on the National Stock Exchange, down 3.1% from the previous close. The company disclosed its earnings after market hours. End
Edited by Saji George Titus
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