February 26, 2024 (MLN): Agha Steel Industries Limited (PSX: AGHA) reported its profit and loss statement for the six months ended December 31, 2023, wherein the unconsolidated profit after tax clocked in at Rs219.04 million [LPS: Rs0.36] compared to a profit of Rs402.15m [EPS: Rs0.66] in the same period last year (SPLY).
The income statement shows that AGHA's net revenue fell 4.29% YoY to Rs9.34bn as compared to Rs9.76bn in SPLY.
Despite this drop in sales, the company's cost of sales edged higher due to which the the gross profit worsened by 19.53% YoY to Rs1.81bn in 1HFY24.
Accordingly, the gross margins of AGHA worsened to 19.36% as compared to 23.02% in 1HFY23.
Under the expense section, the company observed a rise in administrative expenses by 4.62% YoY and other expenses by 2.46x YoY to clock in at Rs170.93m and Rs150.87m respectively during the review period.
Meanwhile, the reported Selling and distribution costs of Rs190.89m during the review period reflects a drop of 0.37% YoY.
The profitability was further dragged down by the decline in other income, which stood at Rs181.08m in 1HFY24 compared to Rs282.82m in the same period last year (SPLY), reflecting a drop of 35.97% YoY.
The situation further worsened as the company’s finance cost surged by 33.13% YoY and stood at Rs2bn as compared to Rs1.5bn in SPLY, mainly due to higher interest rates.
On the tax front, AGHA incurred a tax credit of Rs300.91m in 1HFY24, against a tax expense of Rs211.57m recorded in 1HFY23.
The drop in sales, coupled with the rise in the company's operating expenses and surging finance costs, resulted in the company incurring losses.
| Unconsolidated Financial Results for half year ended 31 December, 2023 (Rupees in '000) | |||
|---|---|---|---|
| Dec 23 | Dec 22 | % Change | |
| Sales | 9,344,664 | 9,763,092 | -4.29% |
| Cost of sales | (7,535,823) | (7,515,336) | 0.27% |
| Gross Profit | 1,808,841 | 2,247,756 | -19.53% |
| Selling and distribution costs | (190,889) | (191,601) | -0.37% |
| Administrative expenses | (170,926) | (163,378) | 4.62% |
| Other Income | 181,076 | 282,818 | -35.97% |
| Other expenses | (150,873) | (61,689) | 144.57% |
| Finance cost | (1,997,179) | (1,500,187) | 33.13% |
| Profit before taxation | (519,950) | 613,719 | -% |
| Taxation | 300,910 | (211,573) | -% |
| Net profit for the period | (219,040) | 402,146 | -% |
| Basic earnings/ (loss) per share | (0.36) | 0.66 | – |
Amount in thousand except for EPS
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Posted on: 2024-02-26T15:16:38+05:00
