Tata Motors Q2 loss at Rs 430 crore

Hit by a one time loss following the port explosion in Tianjin and weaker sales in China, Tata Motors reported a net loss of Rs 429.76 crore compared with a net profit of Rs 3,290.86 crore in the second quarter last year.

The company reported a one time exceptional charge of Rs 2,493.18 crore during the quarter due to damage on account of explosions at Tianjin Port, China. On August 12, 2015, a series of explosions ripped through Tianjin Port, one of the three major locations in China through which Jaguar Land Rover (JLR) imports vehicles. At the time of the explosion, approximately 5,800 vehicles were stored at various locations at Tianjin.

“The process for finalising an insurance claim may take some months to conclude, so insurance and other potential recoveries will only be recognised in future period when paid or confirmed and have not been recognised in this period,” Tata Motors chief financial officer C Ramakrishnan said.

Net sales for the company during the period increased marginally by 1.14 per cent to Rs 60,853.03 crore compared to Rs 60,163.99 crore in the comparable period.

“Weaker China sales and mix, foreign exchange revaluation and higher depreciation and amortisation expenses in the Jaguar Land Rover business impacted performance during the quarter,” the company said.

Jaguar Land Rover wholesales (excluding from China JV) and retails (including from China JV) for the quarter were 1,11,160 units and 1,10,200 units, respectively.

As far as performance of JLR is concerned, revenues for the quarter ended September 30, 2015 stood at £4,831 million against £4,808 million for the corresponding quarter last year, reflecting higher wholesales notably in UK, mainland Europe and US which helped offset weaker sales in China and other emerging markets.

Operating profit (EBITDA) for the quarter stood at £589 million against £933 million for the corresponding quarter last year. Operating margin for the quarter stood at 12.2 per cent.

Profit before tax (before exceptional items) stood at £88 million for the quarter ended September 30, 2015 against £609 million in the corresponding quarter last year due to lower EBITDA, higher depreciation and amortisation, as well as unfavourable revaluation of foreign currency debt and unrealised hedges.