JK Tyre Posts Fourth Quarter Loss

Despite increased sales in 2008, JK Tyre’s fourth quarter results reveal a net loss for the quarter and reduced profits through the entire financial year. The company reports net sales of Rs 40,524.8 million (£591.4 million) during the 12 months to December 31, 2008, up 43.9 per cent on the 2007 yearly result. During the fourth quarter net sales were Rs 7,798.2 million (£113.8 million), a more muted 6.9 per cent increase on the fourth quarter of the previous year.

This is where the good news for JK Tyre ends, however. The company’s bottom line shows a yearly net profit of Rs 52.5 million (£766,200), a blistering 92.1 per cent down on the Rs 667.3 million (£9.7 million) achieved in 2007. For the fourth quarter of the financial year, the company posted a net loss of Rs 273.8 million (£4.0 million), as opposed to a net profit of Rs 217.4 million (£3.2 million) in the last quarter of 2007.

“The unprecedented global economic slowdown has also affected India in no small measure, particularly the automobile sector,” commented company vice chairman and managing director Raghupati Singhania in a statement. “Consequently, demand for tyres has been severely impacted. Furthermore, there has been steep increase in cost of raw materials and inputs. These have severely affected the profitability of the company.”