Bharat Forge, the second largest automotive forging company in the world, has reported fourth quarter and full year results which are lower than expectations. The company's bottom line has come under pressure from higher input and manufacturing costs.

For the fourth quarter ended 31 March 2006, standalone net profits of Bharat Forge increased 9.6 per cent to Rs 53.01 crore from Rs 48.37 crore for the previous year quarter. Total revenues increased 24.62 per cent to 452.84 crore from Rs 363.38 crore.

Operating profits for the quarter increased 17.19 per cent to Rs 105.3 crore from Rs 89.85 crore for the previous year quarter. Operating margins for the quarter were lower at 24.02 per cent as compared to 24.87 per cent.

Operating margins cam under pressure during the quarter due to higher input costs, which increased 32.86 per cent as compared to the previous year quarter. Manufacturing costs increased 25.5 per cent while staff costs rose 18.31 per cent. However the company managed to bring down other expenses by 28.2 per cent, which helped prevent further erosion in margins.

Interest costs for the quarter increased 69.66 per cent while depreciation charges jumped 58.79 per cent over the previous year quarter. Tax provision increased 42.04 per cent from the previous year quarter.

Other income for the quarter increased to Rs 14.42 crore from Rs 2.12 crore.

For the full year 2005-06, standalone net profits of the company increased 28.05 per cent to Rs 206.96crore from Rs 161.63 crore for the previous year. Standalone revenues for the full year increased 32.99 per cent to Rs 1,631.04 crore from Rs 1,226.46 crore.

Export revenues for the full year were Rs 655 crore. Among major overseas markets, US contributed nearly 50 per cent, Europe 32 per cent and the balance came from Asia-Pacific.

Consolidated net profits of Bharat Forge for the full year 2005-06 increased 24.59 per cent to Rs 250.54 crore from Rs 201.09 crore for the previous year. Consolidated revenues for the year increased 54.15 per cent to Rs 3,085.11 crore from Rs 2,001.38 crore.

During the year Bharat Forge had acquired two automobile forging companies in the US and Germany, which have been renamed BF America and Bharat Forge Betellngungs respectively. Consolidated results include the performance of these companies besides another German subsidiary CDP Bharat Forge.

The company has raised a total of $300 million from overseas issues over the last year. The funds have been utilised for overseas acquisitions and expansion programmes. Bharat Forge is doubling its domestic forging capacity, which is expected to be completed later this year.