Mumbai: Apollo Tyres on Tuesday reported a 91% decline in its net profit at Rs5.5 crore for the third quarter ended 31 December, 2008.
The tyre-maker had a net profit of Rs62.17 crore in same quarter of FY’08, Apollo Tyres said in a filing to the Bombay Stock Exchange.
“Profitability was impacted mainly because raw material were procured at higher price prices due to long-term contracts, while end product prices came down as global commodity prices dropped. Also, there was a slump in demand,” Apollo Tyres Chief of Corporate Strategy Marketing and Director Sunam Sarkar said.
Total income dipped by 7.27% to Rs903.25 crore for the quarter under review from Rs974.13 crore in the year-ago period.
“Going forward, we expect better profitability as margins have bottomed out in Q3. Demand is also expected to rise,” Sarkar said.
During the quarter, turnover from exports rose 37% over the year-ago period.
For the nine months ended December, Apollo Tyres reported a 61% drop in its net profit at Rs61.92 crore.
However, the total income during the nine-month period rose nearly 10% to Rs2,960.98 crore.
“The past six months have been very challenging for the automotive industry and our results are a reflection of the situation. Production cuts by OEMs have naturally also impacted us,” Apollo Tyres Chairman and Managing Director Onkar S Kanwar said.
Shares of Apollo Tyres closed at Rs18.95, down 0.79% on BSE.