Apollo Tyres Q3 net halves to Rs83.33cr on 28% spike in raw material costs in the quarter

3 Feb 2022 , 09:18 AM

Apollo Tyres Ltd reported 9.87% yoy growth in total sales revenues for the Dec-21 quarter on consolidated basis at Rs5,707cr. On a sequential basis, the revenues were up by 12.41%.

During the December 2021 quarter, Apollo Tyres saw growth in tyre sales across the regions despite weak auto demand OEM demand on account of production accounts due to microchip shortage. The APMEA segment saw sales grow 11.2% at Rs3,834cr.

The Europe sales were up by 10.9% at Rs1,982cr while the sales in the rest of the world were up 41.9% at Rs1,138cr. The long term debt to equity ratio fell from 3.56X to 2.80X in Q3.

For the Dec-21 quarter, the operating profits were down on a yoy basis by -43.29% at Rs398.66cr. During the quarter, there was a sharp fall in the operating profits from the APMEA region due to maximum input cost impact while the ROW region also saw lower sales.

However, the Europe region operating profits were up 98% on a yoy basis. The main reason for the sharp fall in operating profits was the 28% spike in material costs and a significant jump in other expenses in the quarter.

Operating margins fell marginally from 13.53% in Dec-20 quarter to 6.98% in the Dec-21 quarter. Operating margins were higher on a sequential basis by 110 bps.

Net Profit after tax (PAT) for the Dec-21 quarter was down -51.4% yoy at Rs83.33cr on the back of the weak operating performance getting transmitted to the bottom line. Due to lower profits, the debt service coverage ratio and the interest coverage ratio came in lower during the quarter compared to the Dec-20 quarter.

PAT margins fell from 3.30% in the Dec-20 quarter to 1.46% in the Dec-21 quarter. The PAT margins were also higher on a sequential basis by 57 basis points.

Financial highlights for Dec-21 compared yoy and sequentially

	Apollo Tyres
Rs in Crore	Dec-21	Dec-20	YOY	Sep-21	QOQ
Total Income (Rs cr)	₹ 5,707.47	₹ 5,194.66	9.87%	₹ 5,077.32	12.41%
EBITDA (Rs cr)	₹ 398.66	₹ 702.92	-43.29%	₹ 298.33	33.63%
Net Profit (Rs cr)	₹ 83.33	₹ 171.46	-51.40%	₹ 45.44	83.38%
Diluted EPS (Rs)	₹ 3.52	₹ 7.01		₹ 2.74
EBITDA Margin	6.98%	13.53%		5.88%
Net Margins	1.46%	3.30%		0.89%