Escorts records 5.3% upswing in standalone profit in Q1

Escorts Limited
Escorts Limited informed that its net profit of ₹92.2 crore in the quarter ended June 30, 2020, up by 5.3%, as against a profit of ₹87.5 crore in the corresponding quarter of the previous fiscal and as against ₹140.4 crore in the sequential quarter. Revenue from operations came at ₹1,061.6 crore as against ₹1,423.0 crore in the corresponding quarter and ₹1,380.7 crore in the sequential quarter. EBIDTA for the quarter ended June 30, 2020, was at ₹119.6 crore against ₹142.4 crore in the quarter ending June 2019. EPS reported at ₹7.71 as against ₹7.32 in the corresponding quarter and ₹11.75 in the sequential quarter. At consolidated level revenue from operations at ₹1,089.3 crore as against ₹1,440.5 cores in the corresponding quarter. Consolidated net profit recorded at ₹ 92.6 crore in the quarter ended June 30, 2020, up by 5.6%, as against a profit of ₹87.7 crore in the corresponding period last fiscal. Due to 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.

Chairman and MD, Nikhil Nanda, said, "We are maintaining business continuity and ensuring the safety of our employees, stakeholders & partners aligned to government advisories. 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. 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. 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."

Segmental Performance

Escorts Agri Machinery (EAM)

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 ₹953.5 crore in the quarter ending June 2020 as against ₹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% against 10.9% last year same quarter due to improved product mix, lower costs and continued soft commodity prices.

Escorts Construction Equipment (ECE)
Construction equipment sales volumes 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 ₹52.5 crore in the quarter ending June 2020 as against ₹212.2 crore in the corresponding period last fiscal.

Most of the sales were recorded in 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 ₹16.8 Crore as against ₹5.4 crore in the corresponding period.

Railway Equipment Division (RED)
Revenue for the quarter ended June 2020 was at ₹54.9 crore as against ₹118.1 crore in last year same quarter. EBIT margin declined to 2.6% in quarter ended June 2020 as compared to 20.0% in last year 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 ₹480 crore that will be executed in the next 12-15 months.

The reviewed accounts for the quarter ended June 2020 have been approved by the Board of Directors of Escorts Limited.

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