GURGAON, India — Apollo Tyres Ltd.'s fiscal 2016-17 operating profit was unchanged from a year ago at $290.7 million, while net profit for the year ended March 31 slipped 2.1 percent to $159.9 million.
Net sales jumped 11.1 percent to $1.87 billion, as growth in Europe (up 36 percent) and other overseas markets (up 132 percent) overshadowed the firm's 1.9-pecent increase in its core Asia-Pacific/Middle-East/Africa markets.
Apollo management cited rising raw material prices, which increased sharply quarter-on-quarter, as a key reason for the impacted earnings margins. The operating margin fell two points to 15.3 percent.
For the fourth quarter, net sales increased 10.6 percent to $487.4 million while operating and net earnings dropped 16 percent to $627 millin and $34.1 million, respectively, compared with the year-ago period.
The company's board of directors recommended a dividend payout of 300 percent, to be approved by the shareholders at the forthcoming annual general meeting later in the year.
Apollo Chairman Onkar S. Kanwar said, "There has been a healthy volume growth in the passenger vehicle segment across geographies in the past fiscal; however, the truck radial segment in India, while it has grown in the fourth quarter, has been impacted by the dumping of low cost tires, especially from China, through the year."
India accounts for 63 percent of the tire maker's sales, followed by Europe at 32 percent and other markets at 5 percent.