GULF OIL Turnover Increases by 17% and Profit by 45% in Q2

October 25th, 2007

Hyderabad, October 25th, 2007: GULF OIL Corporation, a Hinduja Group Company, has reported a 17% increase in income in Q2.  Profit Before Tax for Q2 was Rs. 6.66 crores as against Rs.3.51 crores in the same quarter last year.  Profit after tax was Rs. 5.21 crores ( Rs. 3.59 crores ) an increase of 45%.

For H1 the turnover increased by 29% to Rs. 378 crores and Profit after Tax by 22% to Rs. 10.53 crores.

Division wise performance and highlights are as under:

Lubricants Division

The Company’s Lubricants SBU posted a turnover of Rs 95 Crores during the second quarter of financial year 2007-08 as compared to Rs 109 Crores in the corresponding quarter of last year mainly on account of lower exports and sales to institutions which were unremunerative. However, there has been encouraging volume growth in key domestic segments with a doubling of contributions. The increase in contributions was achieved with the growth in higher end products and lower cost of raw-materials.

Inspite of a slowdown in auto industry specially in the commercial vehicles and motor cycles segments as compared to last year the Lube Division continued to show good success in increasing the market penetration. In the commercial vehicles segment the Division continued to achieve success with higher growth in the sales of Ashok-Leyland Gulf Co-Branded lubricants led by India’s first Long Drain diesel engine oils with extended service period of 36000 Kms. There has also been encouraging volume growth in the motor cycle segment with the premium quality Gulf Pride 4T Plus which offers double drain period up to 10000 Kms to the consumers. The Division achieved excellent growth in the ancillary product line of automotive filters and increased retail penetration of Gulf Car Care Products including sales through retail malls and tie-ups with hotel chains.

Explosives Division

The turnover of the Explosives Division which is engaged in the manufacture of full range of commercial explosives and blasting accessories for mining, infrastructure, space, defence and special applications increased in H1 to Rs. 95.91 crores ( Rs. 73.99 crores ) representing a growth of 30% mainly due to increase in mining activity in coal and metal mines. The Division received increased orders from Coal India Limited ( CIL ), a major customer of the Company.

Export of explosives and accessories increased by 54% during the half year whilst the Metal cladding group posted a 31% increase in turnover.

Mining and Infrastructure Division

The service income of the Division in the second quarter ( Q2 ) was Rs. 31.62 cr. as against 10.37 cr in the last year’s Q2 with operations in large coal mining contracts at Northern Coal Fields ( a Coal India Subsidiary ) and at Singareni Collieries stabilising.

The Division has invested Rs 75 cr for its two large Coalmining Projects in the last year and also engaged in large scale iron ore mining in Orissa and Karnataka.

Due to the high technical standards and quality of work, the Division is being offered various contracts in the Mining and construction Sectors.  Presently the Division has about Rs 400 crores of order booked.

Speciality Chemicals Division

Sales for H1 was Rs. 35.32 crores as against Rs. 8.41 crores in the previous half year. Cephalosporins manufactured by the Division were well received in the market.

The Division has obtained EDQM approval ( an European Regulatory Body Approval ) for Enalapril Maleate, a cardiovascular drug. An application for another product ( an antibiotic ) for a similar approval has been submitted to EDQM. Similar registration is at an advanced stage for a cardiovascular drug in Brazil, which has a significantly large market for the drug. Developmental work has been undertaken for two more molecules in the antibiotics group.

Property Development

Work on 40 acres at Bangalore for an IT Park and related infrastructure over a  constructed area of 5 million sq.ft. is currently under approval from the authorities.

Regarding the Hyderabad property development, plans for a Knowledge City over 100 acres oriented towards the fast growing R&D segments is under finaalisation and applications have been made to the AP Government.

For further information please visit www.gulfoilcorp.com or contact:

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