Bestway Cement registers 12% decline in yearly profits

September 07, 2022 (MLN): Bestway Cement Limited (BWCL), Pakistan’s second-largest cement manufacturer, has witnessed an 11.56% YoY decline in its net profits that clocked in at Rs10.24 billion (EPS: Rs17.17) for FY22 ended June 30, 2022, against a net profit of Rs11.58 billion (EPS: Rs10.42) recorded in the last fiscal year.

This decrease in earnings is mainly due to higher tax expenses.

Along with the result, the company announced a final cash dividend of Rs4 per share i.e., 40% for the year ended June 30, 2022. This is in addition to the interim dividend paid at Rs12 per share i.e., 120%.

According to the financial results, the company recorded a net turnover of Rs72bn during FY22, 27% higher when compared to Rs57bn in the corresponding period last year, driven by better selling prices. Thus, the gross profit margin of the company expanded by 3ppt to 32% during the said period.

On the cost side, the major expense side i.e., administrative expenses soared by 2.6x YoY to Rs1.58bn while selling and distribution costs and other operating expenses saw a 59% and 36% YoY jump respectively.

Meanwhile, the financial charges surged by 38% YoY to Rs1.48bn during the review period on an account of the higher policy rate, deteriorating the financial health of the company.

On the tax front, the company paid an amount of Rs9bn as taxes during FY22, showing a more than two-fold increase against Rs11.6bn taxes paid in SPLY, due to the imposition of super tax in large scale industry.

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