United Motors Group achieves Rs 2.27b PAT

United Motors Group recorded strong financial results for the year ending March 312012. During the year under review, the Group achieved a turnover of Rs. 20.8b and a PAT of Rs. 2.27b compared to the post-tax profit of Rs. 907.8m achieved during the previous financial year.

Chief Executive Officer and Executive Director, UML Chanaka Yatawara said, "UML's increased profitability was due to many factors.

From an organisational point of view, UML's strategic price negotiations with its principals, strong cost management framework, introduction of new products, and expansion of the branch network contributed to the strong financial performance. On the macro-economic front, reduced import duties on motor vehicles, lower interest rates and the Government's decision to issue duty free permits created an economic climate conducive to our industry".

"The Mitsubishi vehicle sales division recorded a sale of 2,652 units up from 928 units in the previous year, an 186% increase while the company also saw a significant increase in the sale of genuine parts and workshop services as a result of the increased number of vehicles in the market", he said.

" UML's 100 percent subsidiary, Unimo Enterprises Ltd.,(UEL) also showed a strong performance, fuelled by the sales of the fast moving Perodua Viva.

During the year, Unimo sold 4,446 units of the Perudua Viva- an increase of 159percent.

"UEL's Chinese Division which markets JMC commercial vehicles and Zotye compact Sports Utility vehicles performed exceptionally well-recording a sale of 712 units - up from 139 units last year which was a 412 percent increase.

UML's joint venture, TVS Lanka, also contributed significantly towards the bottom-line, recording two- wheeler sales of 37,432 units - up from 25,494 during the previous year an increase of 46percent. The three- wheeler segment also showed growth compared to the previous year", he said.

The Groups earnings per share of Rs. 33.83 which was an increase of 151.9 percent in comparison to last year, reflected the strong performance by the group for the year.

The excellent results enabled UML to declare the highest-ever dividend payment in its history which was Rs.9 for the year ended March 31 2012. The results further pushed the Group's net asset per share by 46.56 percent to Rs.86.81.

Yatawara, however, said that this financial year would be more challenging with the recent increases in duty, the devaluation of the currency and the higher interest rates. UML has, however, over the past few years focused on building a portfolio of commercial vehicles that caters to most segments and applications.

This segment has not been affected with the changes in duty, and as a result the company will focus more on this sector, while the assembly operation and after sales services would also help minimise the negative impact.