Business

Corporate results: Indus Motor’s profit driven up 177%

Company posts earnings of Rs6.42b in July-March period; EPS jumps to Rs81.7.

Our Correspondent April 29, 2015

Earnings per share (EPS) jumped to Rs81.70 from an EPS of Rs29.53 in the period under review. PHOTO: toyota-indus.com

KARACHI: Indus Motor Company – the makers of Toyota Corolla in Pakistan – posted a massive net profit of Rs6.42 billion in the first nine months of fiscal year 2015 (FY15), up 177% compared to Rs2.32 billion in the same period of the previous year.

Earnings per share (EPS) jumped to Rs81.70 from an EPS of Rs29.53 in the period under review.

The growth was mainly driven by increase in top-line, improved primary margins because of depreciating yen against the dollar and the rupee, Global Research said on Wednesday.

On quarter on quarter (QoQ) basis, the company experienced earnings growth of 239% year-on-year (YoY) (+63% QoQ) to Rs3.28 billion (EPS of Rs41.72). Besides this, the company sporadically announced dividend of Rs20 per share for the third quarter of FY15, bringing the total payout for nine months of FY15 to Rs40 per share.

The revenue of the company increased by 52% YoY on account of volumetric growth of 50% YoY — to 40,141 units during the period. The growth in volume mainly stems from the successful launch of new Toyota Corolla.

The gross margins of the company increased by 5 percentage points to 14.1% during the first nine months of FY15 because of yen shedding its value against the rupee and the dollar, which consequently reduced the raw material cost of the company.

The localisation initiatives during the period shielded it against foreign currency and tariff exposure. Other income grew by 186% YoY to Rs2.15 billion during the period.

The growth in other income is the increased cash reserve, which has allowed company to invest in government bonds.

Published in The Express Tribune, April 30^th, 2015.

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COMMENTS (2)

Woz ahmed | 9 years ago | Reply Price gouging at the expense of the consumer. Look at the price difference between Indian and Pakistani cars before tax, 30% difference. We need to do what Brazil and Argentina did, Brazil has free access for its car industry to the Argentinian market, in return for sourcing 20% of its parts from Argentina. Otherwise let's let the Chinese in, poor quality, but cheap, once the corridor is built, imports will flow cheaply.

Ali | 9 years ago | Reply I want to know what localisation is happening to justify the ridiculous prices charged. I am quite sure engines aren't being produced in Pakistan. Or by localisation do they mean seat covers, floor mats, plastic rubbish? The idea behind tariffs is to encourage the growth of local industry and component producers. But is that really happening or are these large companies just telling the government rubbish to protect their cash cows? We need a full impartial investigation. If these claims are found to be false then the government should just drop the tariffs.

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