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HomeEquityAisha Steel’s profitability plunges by 89% in 9MFY22

Aisha Steel’s profitability plunges by 89% in 9MFY22

April 29, 2022 (MLN): Aisha Steel Limited (ASL) has witnessed a massive 89% YoY decline in net profits for 9MFY22 that clocked in at Rs513.6 million (EPS: Rs0.56) against net profits of Rs4.75bn (EPS:6.11) in same period last year, mainly on the back of lower volumetric offtakes.

Lower CRC-HRC realized delta during the said period can also be attributed to the decline in profitability, a research report by Fortune Securities said.

The net sales of the company increased by 20.5% YoY to Rs49bn, thanks to the increase in volumetric sales and higher retention prices. However, the gross margin has been squeezed to 7.1% as compared to 20.5% during SPLY amid an increase in raw material cost and depreciation of PKR.

On the cost front, the selling & distribution cost surged by 87.5% YoY while administrative and other expenses went up by 20.6% and 40.4% YoY.

The further setback was faced by the company in the form of a notable 87% decline in other income which stood at Rs62.07mn in 9MFY22.

Meanwhile, finance costs increased by 17.7% YoY to Rs1.58bn due to an increase in working capital requirements.

The company recorded an effective tax rate of 26% against 28% reported in the same period last year.

Profit and Loss Account for the nine months ended March 31, 2022 (Rupees '000)

 

Mar-22

Mar-21

% Change

Revenue from contracts with customers

49,116,604

40,753,631

20.5%

Cost of sales

-45,635,682

-32,401,380

40.8%

Gross Profit

 3,480,922

 8,352,251

-58.3%

Selling and distribution cost

-280,184

-149,396

87.5%

Administrative expenses

-282,779

-234,464

20.6%

Other expenses

-700,808

-499,171

40.4%

Other income

62,077

491,889

-87.4%

Profit from operations

 2,279,228

 7,961,109

-71.4%

Finance cost

-1,583,894

-1,346,229

17.7%

Profit before income tax

 695,334

 6,614,880

-89.5%

Taxation

-181,691

-1,863,156

-90.2%

Profit after taxation

 513,643

 4,751,724

-89.2%

Earnings per share – Basic

 0.56

 6.11

-90.8%

 

Copyright Mettis Link News

Posted on: 2022-04-29T13:33:19+05:00

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