Operating profits grew 50% to 6.1 billion (£75 million), from 4.1 billion in 2006/07. Consolidated revenues grew by 9%, while operating profit showed a growth of 50% from 4.1 billion to 6.1 billion rupees. Net sales grew 9% to 47 billion rupees. Apollo also detailed how its retread business is booming – sales of DuraTread retreading materials grew 139% in the period.
However, the company reported a worsening raw material situation, with crude and raw material prices rising sharply in the final quarter of the last financial year. At the beginning of the quarter crude was around $90 a barrel, while by the quarter end it had crossed $113/barrel. Rubber moved from 92 rupees/kg to 116 rupees/kg in the same period.
Commenting on the results, Onkar Kanwar, chairman and managing director of Apollo, said: “It’s been a year of consolidation and a year of planning which will result in numerous expansion projects being launched this year. This year will be Apollo’s year of unprecedented investments across our operations in India, South Africa and Europe. Given this, the improvement in our profitability ratios is heartening, but tough times stare us in the face with all-time highs in almost all our raw materials, inflation and the spectre of a global slowdown.”
During the course of this year Apollo established branded passenger car retail outlets – ‘Apollo Radial World’ in India; and ‘Dunlop Zone’ in South Africa; announced the construction of a Greenfield passenger car tyre manufacturing facility in Hungary; and reported a 105% increase in PCR exports from India and 125% increase in South African exports in general.
Announcing the results, Apollo’s board also recommended a dividend payout of 50%, to be approved at the company’s AGM later in the year. (Tyres & Accessories/Staffordshire, U.K.)
