Farmers’ weather woes pull Escorts Q4 net down 60%
Tractor manufacturer Escorts on Thursday reported 59.84 per cent decline in its net profit at Rs 12.76 crore for the fourth quarter ended March 31, 2015, hit by weak demand due to adverse weather conditions.
The company had reported a net profit of Rs 31.78 crore during the same period of previous fiscal. Net sales of the company also declined to Rs 811.22 crore during the fourth quarter, as against Rs 977.17 crore during the same period of 2013-14 fiscal, Escorts Ltd said in a filing to the BSE.
For the year ended March 31, 2015, the company posted a net profit of Rs 74.71 crore, compared to Rs 179.27 crore during <g data-gr-id="29">previous</g> year. Net sales of the company also declined to Rs 3,962.27 crore during the fiscal ended March 31, 2015, compared to Rs 4,244.47 crore in the previous fiscal.
“The tractor industry has now been impacted for three consecutive quarters by adverse weather conditions. Poor and delayed monsoons have been followed by unseasonal rain that has affected standing crops,” Escorts Chairman Rajan Nanda said. It is important for the government to find ways to protect farmers through a strong and effective crop insurance regime as well as further easing of loans for seeds and inputs, he added. “Though government policies aim to support infrastructure and construction business, we anticipate the industry will continue to face challenges,” Nanda said, adding that recovery, if any, is expected in the second half of this fiscal.
Escorts Managing Director Nikhil Nanda said that despite tough conditions, the company continues to expand its product portfolio. “In line with our strategy, significant efforts are being made in fiscal 2015 to introduce new products, drive innovation and increase market coverage,” he added. The company’s Board, which met today, recommended a dividend of Rs 1.20 per equity share of Rs 10 each for the financial year 2014-15, subject to the approval of the shareholders. Escorts’ shares on Thursday ended 3.28 per cent up at Rs 114.90 apiece on the BSE.