Mumbai, 1 February 2021,
Sandeep Sangwan, managing director, Castrol India Limited:
Castrol India Limited delivered a resilient financial performance for FY 2020 in a difficult year marked by the pandemic and ensuing external challenges.
2020 has been a story of two halves. While we continued with our priorities through the year, keeping safety and wellbeing of our people and supporting communities we operate in at the fore, we gained good momentum in the second half with the partial revival of demand. In 2H 2020, revenue improved by 54% at INR 1,818 crs while profit from operations was 122% higher at INR 501 crs versus 1H 2020.
In 4Q 2020, we continued to invest in our key brands with a significant increase in our marketing and advertising spends year-on-year (INR 65 crs in 4Q 2020 versus INR 11 crs in 4Q 2019), which helped in achieving a top-line growth of 6% versus 3Q 2020. We expect the positive impact of this investment to continue going forward.
We have also taken actions to prepare the business for growth in the future including corrective pricing actions for our commercial vehicles portfolio which has yielded double digit volume growth in the last quarter as well as inventory reduction for distributors to help improve their working capital.
We continued to invest in digital technology and efficiency programmes leading to robust working capital management and judicious cost management thus generating healthy cash flow from operations for FY 2020 of INR 893 crs which is 1.5 times of Profit After Tax.
With the pioneering and innovative spirit that Castrol is known for, we continued to invest in cutting edge technology, as we launched our all new premium range of two-wheeler lubricants in 4Q 2020, Castrol POWER1 ULTIMATE, developed with full synthetic technology for bikes, sports bikes and scooters offering both protection and performance for riders.
Castrol lubricants is now available across over 1,350 Jio-bp sites and has seen good uptake, ensuring a much wider reach and easy accessibility of our premium quality lubricants in the recently launched Jio-bp channel.
The Castrol India business has been focused on driving sustained profitable growth displaying operational resilience and performance in 2020. We
were recognised externally for consistent delivery and performance as JCB awarded us as best supplier for 2020.
We thank the team for their extraordinary efforts in a tough year and are confident that the actions we have taken in this year will be the building blocks to aid our growth in 2021 as and when the economic environment returns to normalcy.
The Board of Directors of the company has at its meeting held on 1 February 2021 recommended a final dividend of INR 3.00 per share (2019: second interim dividend INR 3.00 per share) for financial year ended 31 December 2020. This is in addition to an interim dividend of INR 2.50 per share (2019: INR 2.50 per share).
The register of members and share transfer books of the company will remain closed for the purpose of final dividend from 24 April 2021 to 30 April 2021 (both days inclusive). The final dividend, if approved by the shareholders of the company at the 43rd Annual General Meeting, will be paid on or before 30 May 2021.