Escorts Ltd on Friday reported a 71.18 per cent dip in net profit at Rs 13.2 crore for the third quarter ended June 2011. The company follows an October-September fiscal.
This drop in profit can be attributed to decline in sales and increase in interest outgo.
Net sales for the quarter stood at Rs 728.9 crore, down 9.58 per cent from the year-ago period, a company release said.
The net interest outgo for the April-June quarter stood at Rs 7.59 crore against the inflow of Rs 27.61 crore in the corresponding quarter last year.
“The third quarter results reflect the impact of constrained sales and increase in material costs. Anticipating these developments, the company has made mid-third quarter corrections with a series of initiatives to strengthen growth and improve market share,” said Mr Rajan Nanda, Chairman and Managing Director, Escorts Ltd.
The company's total net operating income during the quarter stood at Rs 739.56 crore (Rs 810.85 crore), down 8.79 per cent.
During April-June 2011, the company's profit after tax (PAT) stood at Rs 13.21 crore (Rs 45.83 crore).
Net sales correspondingly went down to Rs 728.96 crore (Rs 806.21 crore).
Escorts construction
Its wholly-owned subsidiary, Escorts Construction Equipment Ltd (ECEL), recorded net sales of Rs 578 crore for the nine-month period ending June as compared with Rs 417 crore in 2010, up 38.61 per cent.
The improved ECEL performance is on account of expansion in the product portfolio (introduction of backhoe loaders in the growing earth moving machinery segment), the release said.
Escorts' shares closed at Rs 88.05 apiece on the BSE on Friday, down 5.47 per cent from the previous close.