NTS revenues decline in FY2013

NTS revenues decline in FY2013
Published: 26 June 2014
Tyre retailer National Tyre Services (NTS) has reported a subdued set of results for the year ended March 31, 2014 as revenues declined 11 percent from $17,5 million in 2012 to $15,7 million in the year just ended.

Profit before tax was 60 percent lower at $477 017 down from $1,18 million last year.

Earnings per share was at 0,13 cents against 0,34 cents prior year.

Chairman M Bhatia attributed the depressed performance to both internal and external factors.

"Despite a strong start in the first quarter which was in line with budget, revenue ended the year at 11 percent down on the prior year due to the effects of the overall trading environment and a stronger emphasis on working capital reduction in order to mitigate financial risk.

"Margins were squeezed as price influenced purchasing decisions across all market segments within a crowded market. The strategic cost management and productivity enhancement initiatives implemented resulted in overheads being maintained at same levels as prior year," he said.

In terms of the subsidiaries, the Retail & Services unit's sales of new tyres declined by 9 percent compared to prior year. Focused promotional activities in the second half of the year in response to changing market trends helped to mitigate further decline.

Unit sales of retreads grew by 3 percent over prior year. Growth is being hampered by a shortage of good quality casings resulting from the market's preference for cheap and lower quality new truck tyres.

Lobby efforts for bona fide retreaders to be allowed to import good quality casings are ongoing through industry associations. Penetration into the mining sector benefited the re-lugging factory.
- BH24
Tags: NTS,


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