NE BUSINESS BUREAU
NEW DELHI, JUNE 16
JK Tyre and Industries Ltd, one of the largest tyre manufacturers in India, on Tuesday reported a loss of ₹52.78 crore for the fourth quarter ended March 31, 2020, on account of subdued demand in the country and abroad. The company had reported a net profit of ₹33.66 crore in the corresponding period last fiscal.
It has closed financial year 2019-20 with consolidated net profit of ₹141 crore, registering a year-on-year decline of 17.15 per cent. The tyre industry major had posted net profit of ₹170 crore in financial year 2018-19.
Revenue from operations declined a sharp 33.6% year-on-year to ₹1,794.76 crore. Operating profit or earnings before interest, tax, depreciation and amortization (Ebitda) declined significantly by 20.41% to ₹215.75 crore due to the overall decline in the topline.
Commenting upon the results, Dr. Raghupati Singhania Chairman and Managing Director of the Company said, “Tyre industry has been facing a downturn before the current pandemic, which further aggravated the situation posing unprecedented challenges. As a consequence, both the commercial and passenger segments have been severely impacted. Despite this, the Company posted higher sales in passenger car and 2-3 wheeler segments. In addition, exports registered a growth of 37% with renewed focus”.
Dr. Singhania added, “At JK Tyre, our prime concern has been the welfare of our people and their families across all our locations in India and Mexico. We accord the highest priority to their safety and well being more so, in this extraordinary challenging COVID-19 situation”.
He further added, “the Company also encountered headwinds on the currency front with the Indian rupee weakening significantly towards the end of the Financial Year 2019-20. US Dollar liability of the Company along with its subsidiaries Cavendish and JK Tornel, Mexico had to be recorded at the exchange rates prevailing on the last day of the Financial Year, which though exceptional and notional in nature, impacted the Profit Before Tax”.
Dr. Singhania further added, “During this period, we have taken several measures to reduce fixed costs across all activities. We have restarted our plants and are working to streamline operations and sales to ensure sustainable growth and improved profitability.”
