Eicher Motors Limited announces its financial results for the quarter ended December 31st, 2018
Deepthi | Myequity news | Date : 11-02-2019 16:30:00 IST
Eicher Motors Limited (EML), today announced its unaudited consolidated financial results for the quarter ended 31st December, 2018.
In the quarter ended December 2018, Royal Enfield’s total revenue from operations rose 3% to Rs. 2,341 crore,compared to Rs. 2,269 crores in the same period last year; EBITDA was Rs. 680 crores, down by 4% compared to Rs 707 crores in the same period last year; Profit After Tax grew by 2% to Rs. 533 crores from Rs. 521 crores in the same period last year. Royal Enfield sold 193,871 motorcycles in the quarter, registering a decline of 6% from 202,736 motorcycles sold in the same period last year.
Commenting on Royal Enfield’s performance, SiddharthaLal, Managing Director and CEO Eicher Motors Ltd, said, “The latter half of 2018 was a challenging period for the two-wheeler industry in India. Factors like increased insurance requirements, rising raw material costs and the subsequent price increase due to regulatory safety requirements impacted the momentum of the industry. Royal Enfield’s market share recorded improvement on a sequential basis, while volumes in the quarter were impacted. We believe this is a temporary impact due to a price reset. We continue to remain optimistic about the trend of premiumization in the motorcycling industry, and are confident that this trend will continue in the future.”
The third quarter was very exciting for Royal Enfield as the 650 Twin motorcycles - the Interceptor 650 and the Continental GT 650 motorcycles were launched in India and other key markets across the globe. The India launch in November was timed along with Rider Mania - Royal Enfield’s biggest annual festival held on Goa - where the Royal Enfield community and motorcycling enthusiasts got an opportunity to be the first ones to test ride the Twin motorcycles. During the quarter, the 650 Twins were also launched in the UK and Europe at the EICMA Motorcycle Show in Milan, Italy and also in Thailand, Indonesia, Brazil, Colombia and Australia. While retail sales have already begun in India, deliveries in the global markets are expected to begin soon.
“The Interceptor 650 and Continental GT 650 have been loved for their classic styling, simple design and being fun to ride. Consumer response from our test ride experience zones at EICMA 2018, and at Rider
Mania has been phenomenal. The ‘Indian Motorcycle of The Year’ 2019 award for the Interceptor reiterates this consumer response and is a testament of our development and design efforts on these motorcycles. The initial enthusiasm from markets has been very encouraging, and we strongly believe that these modern classics will be an attractive and evocative option for motorcycle lovers everywhere” added Siddhartha.
In the Commercial Vehicles (CV) segment, VE Commercial Vehicles (VECV) - Eicher’s joint-venture with AB Volvo - was affected by the industry slowdown especially in Heavy Duty (HD) segment. VECV’s revenue from operations rose by 9% to Rs. 2,818 crores from Rs. 2,590 crores in the same period last year; EBITDA declined by 18% to Rs. 186 crores from Rs. 226 crores in the same period last year; Profit After Tax declined by 43% to Rs. 76 crores from Rs. 133 crores last year.
VECV sold 16,936 trucks and buses in the quarter, growing 4% over the same period last year.VECV’s performance in the LMD segment continued to be in line with the industry registering 9% growth on a year-on-year basis. In the HD segment, the VECV recorded a growth of 4% while industry declined by 13% year-on-year. During the quarter, certain non-banking financial companies (NBFCs) scaled back their lending activities affecting sales. The trend of heavy discounting continues in the CV industry despite the sustained demand.
Speaking on VECV’s performance Siddhartha
said “While the demand momentum continues in the CV industry, sales were affected especially in HD segment due to change in axle load norms and liquidity crunch. However, in Q3 2019, VECV increased its market share in HD Trucks through focused market penetration and strengthening the product portfolio with new launches of our modernised ‘Value Trucks’ over the past year. We continue to believe that we can be the catalyst that drives modernisation of commercial transportation in India and other developing markets.” About Eicher Motors Limited:
Eicher Motors Limited (EML) is the listed parent of Royal Enfield, the global leader in middleweight motorcycles. The world’s oldest motorcycle brand in continuous production, Royal Enfield has made its distinctive motorcycles since 1901. Focussed on bringing back simple, yet engaging and accessible motorcycling, Royal Enfield operates in India, and over 40 countries around the world. With modern development facilities in Leicestershire, UK and Chennai, India, Royal Enfield makes its motorcycles in Tamil Nadu for the world. In addition to motorcycles, Eicher has a joint venture with Sweden’s AB Volvo - VE Commercial Vehicles Limited.