UB Group fattens staff bill by Rs 400 crore

 UB Group, whose aviation entity Kingfisher Airlines is passing through turbulent times, spent Rs 400 crore more on its staff across various businesses during the last fiscal.

The group’s total staff cost rose to Rs 1,682 crore in the fiscal year ended March 31, 2012, marking an increase of about one-third from Rs 1,274 crore in the previous year.

Barring Kingfisher Airlines, all the other entities saw their employee expenses rise during the last year, shows an analysis of staff costs at the group’s seven listed companies.

At Kingfisher, the decline was only marginal to Rs 669 crore in 2011-12, from Rs 676 crore in the previous fiscal.

Among others, United Spirits and United Breweries witnessed most significant increase in their staff costs, while entities like UB Holdings Ltd, Mangalore Chemicals and Fertilizers, McDowell Holdings and UB Engineering Ltd also saw their respective staff expenses rise during the year.

The combined net sales of these seven group entities are also estimated to have increased by about Rs 4,000 crore (close to 20 per cent) to over Rs 23,000 crore in 2011-12. While Kingfisher and UB Engineerings recorded lower sales than the previous fiscal, the turnover of all other companies rose during 2011-12.

Huge debts and increased costs have been weighing heavily on Kingfisher Airlines for many months now. An overall weakness in the market has added to the woes of the group, whose market valuation has nearly halved in the past one year to close to Rs 23,000 core.

The market losses have been the highest for Kingfisher, whose market value at about Rs 800 crore is less than one-fourth of the level seen about one year ago. The analysis shows that the group spent little more than 7 per cent of its total sales on staff during 2011-12, marginally lower than 6.6 per cent during 2010-11.

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