Chennai, January 29, 2011: The Board of Directors of Tube Investments of India Limited (TII) met today and approved the un-audited financial results for the quarter and nine months ended 31st December, 2010.
During the quarter sales were at Rs. 749 Cr. as against Rs.583 Cr. in the same period last year. The profit after interest and before exceptional items for the quarter was at Rs. 53.70 Cr. against Rs. 40.76 Cr. last year. The profit after interest and before exceptional items for the nine month period was higher at Rs. 161.64 Cr. against Rs. 125.03 Cr. in the previous year representing an improvement of 29%. The net profit for the quarter was at Rs. 51.89 Cr. including a one-time profit of Rs. 20.60 Cr. on sale of land. The profit for the corresponding period in the previous year was at Rs. 17.87 Cr. which was after making a provision of Rs. 9.44 Cr. towards the diminution in the value of its investment and financial assistance to its wholly owned subsidiary, Tubular Precision Products (Suzhou) Company Ltd., in China. Mr. L. Ramkumar, Managing Director said, “All business segments of the company have registered good growth on a higher base of last year. Volume growth, favourable product mix, new product launches, and higher productivity helped the company improve its operating profit during the quarter.”
Review of Businesses – Third Quarter
The Cycles division registered an increase in volume by 14% during the current quarter as compared to the same quarter last year. This was achieved on the back of a 16% growth in the “Specials Segment” and 8% increase in the sale of standard bicycles. The division continues its focus on new product launches, and improvements to its existing range, across segments. Sales of performance bikes and premium bicycles in the MTB and Kids segments registered significant growth. During the quarter the Schwinn range of bicycles for 2011 were launched. 28 additional outlets were opened in the Rural Retail format and we have 36 such stores, operational, as of today. The division currently has 602 retail outlets under the various formats retailing bicycles and fitness products and continue to provide customers a contemporary buying experience and superior service.
Sale of Electric Scooters was lower during the year as compared to the corresponding quarter of the previous year, mainly due to a decrease in the market for such products. In anticipation of an announcement on subsidy for purchase of electric vehicles, customers also held back purchases. With the announcement of the subsidy by the Government, it is expected that sale of electric scooters will increase in the medium term.
In the Engineering Segment precision steel tubes registered volume a growth of 23% in this quarter on the back of growth in the auto industry. Volumes in the value added cold drawn welded tubes segment increased 19% during the quarter. Tubular components maintained their consistent high growth and recorded an increase of 42% during the quarter. Export of tubes declined by 14% during the quarter due to low demand from the North American market.
Metal Formed Products segment also registered good growth in the quarter. Sale of automotive chains has increased by 27% and that of industrial chains by 18% in volume terms. Sale of fine blanked components increased by 139% with the success of all new product programmes undertaken during the last year. Export of industrial chains grew significantly by 51% with increased demand from its overseas customers. Sales of car doorframes increased 4% and we also registered a growth of 33% in the cold rolled products to the Railway segment.
During the quarter the Company renewed the Long Term contracts with the employees union in two of its businesses. The renewed contracts would help in increase of production and productivity of these businesses.
The profit after interest and before exceptional items for the quarter was at Rs. 90.72 Cr. against Rs. 35.27 Cr. last year. The profit after interest and before exceptional items for the nine month period was higher at Rs. 266.90 Cr. against Rs.106.11 Cr. in the previous year representing an improvement of 152%. Cholamandalam Investment & Finance Company Ltd, a subsidiary company in the financial service business achieved profit after tax for the quarter of Rs. 7.13 Cr. against a profit of Rs. 6.26 Cr. in the previous year. Cholamandalam MS General Insurance Company Ltd. a general insurance subsidiary of the Company registered a growth of 34% in Gross Written Premium during the quarter. The company achieved a net profit of Rs. 5 Cr. during the quarter against a loss of Rs.5.6 Cr. during the corresponding quarter last year.
Financiere C 10, the Company’s overseas subsidiary making Industrial chains achieved a turnover of 27.9 Mn Euro for the financial year 2010 and registered a growth of 4.3%. The unaudited Profit before Tax of 0.4 Mn Euro represents a growth of 14% over the last year.
About Tube Investments of India
Tube Investments of India consists of TI Cycles of India, Tube Products of India, TI Metal Forming (including Chains). In bicycles, TII is the second largest manufacturer with well-known brands – Hercules, BSA and Philips. TII is the market leader in precision steel tubes and roll-formed car doorframes in India. Also, being the second largest motor cycle chain manufacturer in India, TII is a major supplier to the Indian auto / auto- component industry. In the recent times, the Company has introduced E- Scooters.
About Murugappa Group: Founded in 1900, the Rs.13617 Crores (USD 3.03 billion) Murugappa Group is one of India’s leading business conglomerates. The Group has 29 businesses including seven listed companies actively traded in NSE & BSE. Headquartered in Chennai, the major companies of the Group include Carborundum Universal Ltd., Cholamandalam Investment and Finance Company Ltd., Cholamandalam MS General Insurance Company Ltd, Coromandel International Ltd, Coromandel Engineering Company Ltd, EID Parry (India) Ltd, Parry Agro Industries Ltd, Tube Investments of India Ltd and Wendt (India) Ltd.
Market leaders in served segments including Abrasives, Auto Components, Cycles, Sugar, Farm Inputs, Fertilizers, Plantations, Construction, Bio-products and Nutraceuticals, the Group has forged strong joint venture alliances with leading international companies like Mitsui Sumitomo, Foskor, Cargill, Groupe Chimique Tunisien, Winterthur Technology Group and Morgan Crucible. The Group has a wide geographical presence panning 13 states in India and 5 continents.
Renowned brands like BSA, Hercules, Ballmaster, Ajax, Parry’s, Gromor and Paramfos are from the Murugappa stable. The organization fosters an environment of professionalism and has a workforce of over 32,000 employees.
For any clarifications please contact Mr. L. Ramkumar, Managing Director, Tube Investments of India Ltd., Ph – 044 – 4228 6702 / 4211 4747, Email :RamkumarL@tii.murugappa.com
For further information, please contact:
Vinod Kumar / Diya Kinger
Ogilvy Public Relations Worldwide, Chennai
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