Bosch raises capex to Rs 600 cr for 2014, Q4 PAT slumps 19.2%

Bosch raises capex to Rs 600 cr for 2014,  Q4 PAT slumps 19.2%

German technology and services giant Bosch will increase its capital expenditure to Rs 600 crore in 2014 as the company focuses on growth and expansion in the mid-term, Bosch Limited Managing Director Steffen Berns said on Thursday.

Announcing the fourth quarter results of the company in calendar 2013, Berns said that cumulative measures on cost control throughout the year had helped the company arrest the decline in profitability despite the unutilized capacity. The focus of the company remains on growth and expansion in the mid-term, he said.

Bosch invested Rs 500 crore on expanding capacity at its Nashik plant last year.
In September last year, it started work on a new manufacturing unit for diesel injection components in Bidadi near Bangalore. “This year, we will be further augmenting our existing facility at Adugodi which will be transformed into a R&D hub,” Berns said.

Bosch had inventory worth Rs 1,207 crore at the end of the fourth quarter, a 10 per cent rise over Rs 1,096 crore a year earlier.

The non-automotive business grew by over 19 per cent in Q4, reflecting the company’s efforts in this business area. Power Tools and Packaging Technology division registered double-digit growth for the year 2013.

Q4 profits slump        The prolonged slowdown and weak consumer demand in the automotive industry impacted the company’s bottomline in the fourth quarter (Q4) of calendar 2013 ending December 31. Net profit after tax (PAT) declined 19.2 per cent to Rs 139 crore in Q4 from Rs 172 crore in the corresponding quarter of 2012.

PAT during calendar 2013 was Rs 885 crore, falling 7.6 per cent from Rs 958 crore a year earlier. Bosch Limited Managing Director Steffen Berns told reporters, “Weak consumer demand has impacted the overall industry as well as our growth. Our non-automotive business has been doing very well with its share increasing steadily as we continue to expand our operations in this sphere.”

Higher cost of materials and stock-in trade purchases which increased 9.75 and 4.92 per cent respectively, coupled with rising employee costs exercised 26.5 per cent declension in profit before tax figures in Q4 from Rs 245 crore a year ago to to Rs 180 crore.

Net sales and income from operations (exclusing other income) showed flat growth at Rs 2,062 crore from Rs 2,061 crore a year ago. For the entire year, net sales touched Rs 8,641 crore, increasing 1.4 per cent from Rs 8,522 crore a year ago.

The company’s revenues from the non-automotive part of the business has grown to 13 per cent as a share of total revenues from 11 per cent in 2011.

The board of directors of Bosch recommended a dividend of Rs 55 per share for 2013, from Rs 60 per share in 2011.

Energy services launched    Bosch on Thursday also launched its energy conservation and building solutions business in India to focus on the energy sector and its associated products and services.

The new service line, ‘Bosch Energy and Building Solutions India’ dedicated to the energy sector in India will help Bosch Ltd consolidate its position in the energy business as a full-line solution provider, offering products, solutions and services, Steffen Berns said.

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