Castrol India records strong 2Q 2018 results

Quarterly highlights (2Q April - June 2018):

  • Profit after tax up 19% at Rs.164 crore
  • Revenue from operations up 17% (on comparable basis versus last year)
  • Double digit volume growth

Half yearly highlights (1H January - June 2018):

  • Profit after tax up 9% at Rs. 346 crore
  • Revenue from operations up 11% (on comparable basis versus last year)
  • Volume growth faster than market
Castrol India Limited today announced its results for the second quarter (April-June) and first half (January-June) of 2018. 

Profit After Tax during the period April to June 2018 was up by 19% at Rs.164 crore as compared to the same period last year, driven largely by higher volume as well as improved margin. Profit After Tax during the half year January to June 2018 was up by 9% at Rs.346 crore as compared to the same period last year.

Reported Revenue from Operations during the quarter and the half year under review is not comparable with last year numbers due to changes in treatment of indirect taxes post GST implementation. Excluding this impact, Revenue from Operations in the quarter under review increased by 17% over same quarter last year and by 11% over the first half of the year compared to previous year. 

The Board of Directors of the Company has at its meeting held on 31 July 2018 recommended an interim Dividend of Rs.2.25 per share (2017: Interim dividend Rs.4.50 per share). The said interim Dividend is on the enhanced paid up share capital post issue of Bonus shares in the ratio of 1:1 allotted on 26 December 2017. The record date for the purpose of said Interim Dividend is 10 August 2018 which would be paid on or before 29 August 2018. 
Commenting on the results, Omer Dormen, Managing Director, Castrol India Limited said: “I am delighted with our continued strong financial performance during the second quarter April-June 2018. In line with our strategy, we have delivered volume growth for the tenth successive quarter, year on year (except the quarter of April – June 2017 impacted by the GST transition), despite the steep rise in input costs.”

“Close to 80% of our growth has come from the new products launched during the last nine months. What is particularly pleasing is that despite the challenging cost environment, we have grown faster than the automotive lubricants market.”  

“While personal mobility continues to be a key strategic growth driver, the focus on our significant commercial vehicle engine oil portfolio is also delivering results with record volume growth driven by launch of new products and aided by a favourable economic environment, with emphasis on infrastructure development.”  

Maintaining Castrol India’s commitment to deliver differentiated, technologically superior, future-ready products with distinctive consumer benefits, the company strengthened its Specialties portfolio, introducing Castrol TRANSMAX driveline oils and Castrol SPHEEROL greases providing increased protection and reduced downtime. 

In recognition of the company’s superior quality and customer excellence, it was awarded the ‘Overall Performance’ trophy by Maruti Suzuki India Limited. The company has also been chosen as approved supplier for Suzuki Ecstar branded lubricants in their premium NEXA channel. 
Castrol India was also awarded the prestigious ‘Golden Peacock Occupational Health and Safety Award’ for its manufacturing plant at Patalganga, acknowledging its focus on safety as a key priority for the business.

Outlook:

With the continued volatility in crude oil price and steep depreciation of the Indian rupee, the company expects a challenging second half, but will be taking appropriate actions to support the volume growth momentum.

Despite these short term challenges, Castrol India continues to remain optimistic about the long term growth potential of the business aligned to its long term strategy underpinned by continued investments in technology and brands, aggressive expansion of distribution network, innovative marketing programmes and delivery of premium customer experience across multiple touch points.