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Surge in auto imports in 2010, up by ten-fold

Sri Lanka´s United Motors has nearly doubled (98.5%) its third quarter consolidated revenues to Rs. 3.42 billion, from Rs. 1.72 billion in the last financial quarter, according to unaudited financials for the nine months ending December 31, 2010. The third company to release its results in the current earnings season, United Motors also showed a significant increase (70.5%) in consolidated revenues for the nine months to end-December 2010, which ultimately reached Rs. 7.03 billion.

United Motors vehicle sales performance somewhat mirrors the local automobile industry´s performance in 2010 where a tenfold increase in motor car imports has been witnessed over the year. This is due to import taxes being effectively halved in June 2010, with official estimates indicating about 10,000 cars having been imported between June and September. This can be compared to just over a 1,000 cars imported over the entire 2009 period.

The company said that segment-wise, the jump in revenues was mainly attributable to a more than doubling of vehicle sales with spare parts, repairs and servicing and lubricants performance also experiencing double digit growth. On the other hand, the company´s tyre business witnessed negligible growth, while its finance leasing unit suffered a loss of revenue of more than 60%.

Additionally, the company also recorded after-tax net profits of Rs. 364.39 million for the three months to end-December 2010, a 1,132.3% year-on-year increase from 2009´s Rs. 32.18 million. After-tax net profits for the nine months ending December 31 were also shown to take off, ultimately reaching Rs. 559.18 million in 2010. This was from a loss of Rs. 60.80 million in 2009. All together resulting in a year-on-year increase of 1,019.6% in after-tax net profits.

The company also recorded an earnings per share increase of close to a 1000 % to Rs. 8.31 for the nine month period to end-December 2010. This is compared to a loss per share of Rs. 0.90 for the same period in 2009. However, this follows a one-to-one share split carried out by United Motors in the latter half of 2010. The company also recorded significant increases in key financial ratios such as Net Asset Vale Per Share, Current Ratio, Quick Asset Ratio and Interest Cover, while its Consolidated Borrowing to Equity Ratio fell to 43.06% at end-December 2010, from 128.68% at end-December 2009.


Posted on Tuesday, January 25, 2011 @ 09:29:29 LKT


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