Escorts Q1 profit up by 5.3 per cent to Rs 92.2 crore

In this prolonged pandemic, the company is finding new ways to connect with its customers to provide uninterrupted service.
Escorts Q1 profit up by 5.3 per cent to Rs 92.2 crore

Escorts Limited, farm equipment and engineering major, has posted its net profit of Rs 92.2 crore in the quarter ended June 30, 2020, up by 5.3 per cent, as against a profit of Rs 87.5 crore in the corresponding quarter of the previous fiscal and as against Rs 140.4 crore in the sequential quarter.

Revenue from the company’s operations stood at Rs 1,061.6 crore as against Rs 1,423.0 crore in the corresponding quarter and Rs 1,380.7 crore in the sequential quarter.

EBIDTA for the quarter ended June 30, 2020, was at Rs 119.6 crore against Rs 142.4 crore in the quarter ending June 2019. EPS reported at Rs 7.71 as against Rs 7.32 in the corresponding quarter and Rs 11.75 in the sequential quarter.

At consolidated level revenue from operations at Rs 1,089.3 crore as against Rs 1,440.5 cores in the corresponding quarter. Consolidated net profit recorded at Rs 92.6 crore in the quarter ended June 30, 2020, up by 5.6 per cent, as against a profit of Rs 87.7 crore in the corresponding period last fiscal.

Due to the unprecedented COVID-19 pandemic situation during this period, the financials for the quarter ended June 2020 do not represent normal operations and to that extent are not strictly comparable with any normal quarter.

Nikhil Nanda, Chairman & MD, Escorts Ltd. said, "In this pandemic, we are trying to find new and innovative ways to connect with our customers and providing them with un-interrupted product distribution & service.”

Amid this unprecedented scenario of a global pandemic, agriculture has picked up rural demand for the company. He pointed out, “Rural demand in agriculture has been encouraging and the government focus will aid to the sector in helping farming to continue the momentum. Amidst the challenging environment, while we have witnessed a revival in our agriculture business this quarter, our construction and railway business have been impacted because of lockdown and related issues across geographies.”

Though he was hopeful for a recovery, he expressed, “We will see a recovery soon as the market situation gets better and the economy across layers improves. We are optimistic about the coming quarters and hope that the efforts will help in containing the crisis and the global economy will be on its strength again."

Tractor sales volume for the quarter ended June 2020 were 18,150 tractors as against 21,051 tractors in the corresponding period last fiscal. Segmental revenues came at Rs 953.5 crore in the quarter ending June 2020 as against Rs 1,092.0 crore in the corresponding period last fiscal. Despite lower volumes, EBIT margins for Agri Machinery Business went up by 356 bps to 14.5 per cent against 10.9 per cent last year the same quarter due to improved product mix, lower costs and continued soft commodity prices.

The construction equipment sales volumes of the company for the quarter ended June 2020 were at 234 machines as against 1,067 machines in the corresponding period last fiscal. Segmental revenues came at Rs 52.5 crore in the quarter ending June 2020 as against Rs 212.2 crore in the corresponding period last fiscal.

Most of the sales were recorded in the last month of the quarter, due to nationwide lockdown in the month of April and May 2020, resulting in EBIT for the quarter ended June 2020 at negative Rs 16.8 crore as against Rs 5.4 crore in the corresponding period.

Revenue for the quarter ended June 2020 was at Rs 54.9 crore as against Rs 118.1 crore in last year same quarter. EBIT margin declined to 2.6 per cent in the quarter ended June 2020 as compared to 20 per cent in last year the same quarter, due to reduced sales.

Due to the outbreak of COVID-19 pandemic, the production of coaches and locomotive across all Railway units has been affected. Current order book as of 30th June 2020 is more-than Rs 480 crore that will be executed in the next 12-15 months.

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