United Motors Lanka PLC (UML) and its subsidiaries achieved a Rs.10.9 billion turnover and recorded a Rs.1.38 billion pre tax profit for the year ended March 31, 2011. This record performance compares with a Rs. 134 million pre tax profit achieved during the previous financial year.
Group profit after tax (PAT) for the year amounted to Rs. 907 million in comparison to Rs.146 million in 2009/10.
Further, UML per se achieved a Rs.735 million profit before tax and a Rs. 519 million PAT as compared to a Rs.121 million PAT in the same period the previous year.
UML Chief Executive Officer/Executive Director Chanaka Yatawara said, “This is the highest ever group profit recorded, where the current year Group and company PAT increased by 520% and 328% respectively year on year (YoY)”. He said that the year under review saw a 48% increase in Mitsubishi vehicle sales which was supported by increased Mitsubishi spare parts sales and workshop services.
Profitability increase was due to a multitude of factors including vehicle sales increase due to reduced motor vehicle import duties, interest rate reduction, expansion of the branch network for products and services’ greater accessibility and strong cost management.
Unimo Enterprises Ltd. (UEL) which is a UML subsidiary, showed a robust turnaround, recording a sale of 1,716 units of its fast moving Perodua Viva which is predominantly in the under 1,000 cc category. Viva sales showed an 808% increase YoY. Its other divisions too performed better than the previous year with an encouraging turnaround by its Chinese Division which markets JMC commercial trucks, Zotye mini sports utility vehicles and its recently launched DFSK mini trucks. UML’s main joint venture, TVS Lanka, also delivered significant profits, contributing Rs. 194 million to Group profit. In the year ahead the company is confident that the momentum would continue due to favourable economic conditions and the country’s infrastructure developmen and the expectation that the current tax structure will remain. In addition, permits issuance to senior government officials is expected to bring in incremental income to United Motors and its subsidiary UEL.
The group is also considering a state-of-the-art assembly facility for TVS Lanka which will accommodate TVS two wheelers and three wheelers under one roof, to be built in the company’s six acre Kaduwela property.
UEL is also expected to perform well in view of the spectacular demand for its Perodua vehicles, its Zotye brand local assembly operation and its other Chinese products that have proven to be a popular choice for commercial vehicles.