Eicher Motors Limited announces financial results for the quarter and year ended March 31, 2020

New Delhi, June 12, 2020: Eicher Motors Limited (EML) today announced its audited consolidated financial results for the quarter and year ended March 31, 2020.

For the quarter ended March 31, 2020, Eicher Motors’ total revenue from operations was recorded at Rs. 2,208 crores, down by 12% as compared to Rs. 2,500 crores in the corresponding quarter of FY 2018-19; EBITDA was Rs. 432 crores, down 37% as compared to Rs. 685 crores in the same quarter of the previous financial year; Profit After Tax was Rs. 304 crores as compared to Rs. 545 crores during the same period last year. Royal Enfield sold 163,083 motorcycles in the quarter, a decline of 17% from 197,567 motorcycles sold over the same period in FY2018-19.

For the Financial Year ended March 31, 2020, Royal Enfield’s total revenue from operations was down by 7% to Rs. 9,154 crores, compared to Rs. 9,797 crores recorded for the year ended March 2019; EBITDA was Rs. 2,180 crores, down by 25% compared to Rs 2,903 crores; Profit After Tax was recorded at Rs. 1,827 crores as compared to Rs. 2,203 crores in the same period last year. Royal Enfield sold 697,582 motorcycles in the year, down 15% from 822,724 motorcycles sold in FY 2018-19. Motorcycle sales to international markets have shown significant growth of 96% at close to 38,700 motorcycles, over the previous financial year.

Commenting on  Eicher  Motors’  performance,  Siddhartha Lal, Managing Director of Eicher Motors Ltd, said, “This has been a tough year overall for the industry, and the global pandemic during the last quarter brought with it unprecedented challenges and disruptive changes. At Eicher Motors, we have witnessed the impact of this situation, but have chosen to focus on the opportunities within these problems. With a commitment to our long term plans, we moved swiftly to tackle the roadblocks, to safeguard our businesses and to do our bit towards relief and support measures. Now, as the lockdown is easing out, we see strong initial customer interest and confidence. Both at Royal Enfield and VECV, we have transitioned our entire product portfolio to the new BS-VI emission norms, and also managed to sell our entire BS-IV inventory well ahead of the mandated timeline. Our BS-VI products have received great feedback from customers and we have planned a strong product line-up going forward. We have built our businesses on solid fundamentals. We have a strong balance sheet and cash position, a robust business model with a very focused approach, and an exceptional management team at Royal Enfield and VECV. This has helped us tremendously in facing current challenges and gives us the confidence that we will emerge stronger from this crisis”

Speaking  on  Royal  Enfield’s performance,  Vinod  K.  Dasari,  CEO,  Royal  Enfield said,  “Through a challenging year, Royal Enfield has remained focused on sharpening the customer experience with emphasis on seamless and differentiated brand interface. We have had the best ever export performance in international markets during the year with a 96% increase as compared to last year. We have introduced new products and new initiatives to create better accessibility and build increased engagement. While new variants of the Bullet and Classic brought in more accessibility in product, the 600+ new Studio Stores created accessibility in terms of reach and footprint and brought the pure motorcycling experience closer to customers. The Royal Enfield Slide School has built an engaging and accessible entry into flat-track racing. Our global online community has been growing at a significant rate over the last year - we now have a 7.5 million strong online community. Over the last few months, various digital campaigns we’ve run have fuelled conversations and have increased overall engagement between 50%-80% across different platforms. Going forward, we will focus on enhancing this digital engagement and the overall purchase and ownership experience through newer, more seamless digital platforms”

The last quarter of this fiscal was particularly challenging in the wake of the unprecedented coronavirus pandemic.  Royal  Enfield’s  manufacturing  and  retail  operations  were  suspended  between  March  23rd and May 5th as per Government directives. The company has since resumed operations, and more than 90% of its retail network is now operational. The Eicher Motors Group has pledged an initial CSR outlay of Rs. 50 crore towards various immediate relief and support measures to tackle he pandemic.

Royal Enfield continues to strengthen its distribution network in India and internationally. During this quarter, Royal Enfield added 100 new Studio Stores, taking the overall retail touchpoints to 1,521 across India; at 921 dealerships and 600 Studio Stores. Royal Enfield significantly expanded its international market network during the year 2019-20. Exclusive stores have now almost doubled from 42 stores in 18 countries to 77 stores in 21 countries; 10 stores were added during this quarter.

Royal Enfield has been among the first automotive companies in India to successfully sell all existing inventory of BS IV motorcycles, thereby becoming fully compliant with the new BS VI emission norm adequately ahead of the mandated timeline. Thereafter, the company has ensured a seamless transition from BS IV to BS VI across its entire motorcycle portfolio. The company introduced BS VI compliant motorcycles in early January, with the Classic 350 dual-channel ABS and subsequently all motorcycles have now transitioned to BS VI.

In keeping with the strategic product pipeline, Royal Enfield announced the end of production of the 500cc single-cylinder, long-stroke, unit construction engine motorcycles in India. To commemorate the legendary motorcycle, a special, end-of-build edition was launched - The Classic 500 Tribute Black Limited Edition - and these were sold through an online sale.

In the last quarter, the first ever Slideschool edition was successfully held at Big Rock Dirt Park in Bangalore. The Slide School is a step towards being a more experiential brand and providing opportunities to build accessible entry into flat track racing. The Slideschool will be rolled out across different cities in the country. Royal Enfield also held the 2nd edition of Winter White Out wherein 11 riders explored the treacherous routes amidst the mighty Himalayas on their Royal Enfields. To further engage the global community, Royal Enfield organized marquee rides including the Tour of Thailand (3rd edition) and Tour of Indonesia (2nd edition).

For  the  quarter ended 31 March 2020, VECV’s revenue from operations was Rs. 2,101 crores, down by 35% from Rs. 3,209 crores in the same period last year; EBITDA was Rs. 38 crores, down 86% as compared to Rs 274 crores in the corresponding quarter of the previous year. There was a loss of Rs. 26 crores as compared to Profit After Tax of Rs. 139 crores during the same period last year. VECV sold 11,629 trucks and buses in the quarter, a decline of 45% from 21,010 trucks and buses sold over the same period in the last financial year.

Speaking  on  VECV’s  performance  Vinod  Aggarwal,  MD  and  CEO  VECV  said  “Commercial  Vehicle industry reeled under pressure for most part of the last financial year with annual sales lower by 40% and Q4 with 55% respectively. This quarter saw the commercial launch of our BS VI solution - EUTECH 6. EUTECH 6 offers a unique mix of Eicher’s Euro VI expertise, mileage superiority and industry first uptime solutions. With this, we are in a distinctive position to offer a comprehensive BS VI platform to the customers which will enhance their productivity, efficiency and profitability. This business proposition coupled with competence building done across our network gives VECV an edge in the CV industry.

The ongoing global pandemic has further impacted the CV industry. Restrictions have been lifted in a phased manner at VECV plants, our dealers and suppliers. To aid recovery, we have also extended support to our suppliers and channel partners to help them tide over this challenging situation. Channel inventories were at an all-time low which helped them in managing their working capital better. Despite the annual industry market drop of 40%, VECV declined by 33%, and during this difficult time the silver lining was that our market share increased to 5.9% in Heavy Duty and close to 30% in Light and Medium Duty.

New innovative methods and digital tools are being deployed to connect with the customers and help restart their business. While the current situation is definitely tough and industry will take time to get back on track, VECV has developed responses for various scenarios to emerge stronger in the future.”

About Eicher Motors Limited:

Eicher Motors Limited (EML) (Bloomberg: EIM IN Reuters: EICH.NS) is the listed parent of Royal Enfield, the global leader in middleweight motorcycles. The world’s oldest motorcycle brand in continuous production, Royal Enfield has made its distinctive motorcycles since 1901. Focused on bringing back simple, yet engaging and accessible motorcycling, Royal Enfield operates in India, and over50 countries around the world. With modern development facilities in Leicestershire, UK and Chennai, India, Royal Enfield makes its motorcycles in Tamil Nadu for the world.

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