Ashok Leyland reports Rs 141.75 crore loss in Q1

Company's total income for quarter was down by 22% to Rs 2,363 crore as compared to Rs 3,026 crore

Commercial vehicle maker Ashok Leyland has reported a net loss of Rs 141.75 crore in the first quarter of the current fiscal as compared to a net profit of Rs 66.93 crore in the corresponding quarter last year. Company’s total income for the quarter was down by 22% to Rs 2,363 crore as compared to Rs 3,026 crore.

Vinod K Dasari, managing director, Ashok Leyland said that “what we are experiencing is one of the harshest and steepest of downturns and while we are combating it, the situation also affords us an opportunity to streamline our processes towards becoming a leaner and far more customer-oriented organisation.”

He further said although the entire commercial vehicle industry has had a very tough first quarter, Ashok Leyland remained focused on being future-ready by staying committed to our product development, network expansion and cost control programmes.

The Company registered a turnover of Rs 2,363.81 crore for the quarter ended June 30, 2013 as against Rs 3,026.89 crore of the corresponding quarter of the previous fiscal. However, the various cost control measures have helped the Company remain positive on the EBIDTA front.



Company’s sales for the quarter stood at 14,900 units as compared to 20,239 units, with domestic volume of 12,960 units as compared to 17,335 units, a drop of 25% over the previous corresponding quarter. Light commercial vehicle Dost volumes down to 6,824 from 7,248 units and international sales stood at 1,940 units as compared to 2,904 units.

The company in a statement said that to address the situation its manufacturing being rationalised to improve asset utilisation and efforts are being taken to reduce debt and operational expenses.

Speaking at the company’s annual general meeting today at Chennai, Dasari said Ashok Leyland is bullish on its proposed new launches this year and there are few green shoots though the economy remains largely bearish.

“The monsoon is on time and the Government is fast tracking the stalled road projects. The JNNURM scheme, renewal of mining licence and the new Defence procurement are positive for us will help," said Dasari.

To effectively address the tough situation that is expected to last for this fiscal, the Company has initiated concerted efforts to reduce its breakeven point. Manufacturing footprint is being rationalized to improve asset utilization. Focused efforts to reduce the debt have been accelerated and steps have been taken to reduce operational expenses.

On the outlook for the fiscal, he said although the market is still very volatile there are some green shoots showing. However, while we cannot control the market, we are focused on preparing ourselves for a revival which is bound to come hopefully sooner rather than later.

“We are seeking to capitalise on our gains in the ICV space with the launch of the BOSS vehicle which should win us market share. This will be followed by the introduction of the Neptune engine on select Multi-Axle vehicle models and the N-Truck with a revolutionary, new, world-class cab. The JNNURM 2 should prove to be an ideal launch pad for the Janbus. To support all this, we will continue to be aggressive in our network expansion and all these are going to help us to be future-ready,” he concluded”.