The Board of Directors of Cummins India Ltd., at their meeting held recently, took on record the unaudited financial results for the quarter and half year ended September 30, 2019.
Net sales of the company for the quarter ended September 30, 2019 at Rs. 1,285 crores, declined 11% as compared to Rs. 1,452 crores recorded in the same quarter last year and 2% compared to Rs. 1,316 crores recorded in the preceding quarter. Net sales for the half year ended September 30, 2019 at Rs. 2,601 crores declined 5% over same period last year’s sales of Rs. 2,748 crores.
Domestic sales in the current quarter at Rs. 947 crores declined 6% over the same quarter last year and 4% compared to preceding quarter. Domestic sales for the half year ended September 30, 2019 at Rs. 1,937 crores grew 4% over the same period last year. Exports for the current quarter at Rs. 337 crores declined 25% over the same quarter last year however improved 3% over the preceding quarter. Exports sales for the half year ended September 30, 2019 at Rs. 664 crores declined 25% over the same period last year.
Profit before tax in the current quarter at Rs. 210 crores is 29% lower as compared to Rs. 298 crores recorded in the same quarter last year and 8% higher as compared to Rs. 194 crores recorded in the preceding quarter.
Mr. Ashwath Ram, Managing Director, Cummins India Ltd., said: The current sluggishness in the Indian economy arises from several factors including the prevailing liquidity situation, delays in awarding of infrastructure projects, banking sector including the shadow banks continuing to sort through their funding constraints. These factors have all resulted in reduction in demand across our key segments in the domestic business. In our estimation this is likely to play out further for some time with a gradual revival thereafter. The Government has already undertaken significant actions to boost the economy, including allocating incremental funds to the execution of infrastructure projects, easing out liquidity as well as reduction in corporate tax rate, accompanied by interest rate cuts.
Our confidence on the medium to long term outlook on domestic sales, especially from the infrastructure sectors is high, once the fund allocations from the fiscal Union Budget, start to positively impact this sector.
Export markets have continued to display softness in recent quarters, arising from global economic challenges. In this quarter we also experienced decline in certain markets within the global power generation business, based on difficulties that some of these economies are now experiencing.
We have initiated internal actions to curtail overall spending to essential only, as well as improving on the efficiency of our internal processes and product coverage, creating a strong environment of cost consciousness.
We continue to be positioned to outperform in our industry and continue investing judiciously in product enhancements, increasing our customer focus, while maintaining productivity and quality as strong focus areas, as we continue delivering value to all our stakeholders.”