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Amreli Steels reports losses of Rs 688 million as gross margins take a hit

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April 27, 2020 (MLN): Amreli Steels Limited reported its financial results for the nine months ended March 31, 2020, on Monday, which show that the company incurred losses of Rs. 688 million (LPS: 2.23), as opposed to profits of Rs. 223.5 million (EPS: 0.75) recorded in the same period of last year.

According to a research report by BIPL Securities, the losses emanated mainly from higher raw material cost which left a significant impact on the gross margins, rise in major expense heads, and skyrocketing tax expense.

The profitability of the company also suffered at the hands of Finance cost, which showed a 1.08x increase due to the increase in policy rates in the last few months.

The topline income of the company, however, surged by 14.25% on account of frequent price adjustments, witnessed especially during the third quarter.

Profit or Loss Account for the nine months ended March 31, 2020 (Rupees in '000')

 

Mar-20

Mar-19

% Change

Sales

21,390,265

18,723,109

14.25%

Cost of sales

(19,630,105)

(16,882,764)

16.27%

Gross Profit

1,760,160

1,840,345

-4.36%

Distribution cost

(540,955)

(438,690)

23.31%

Administrative expenses

(462,571)

(371,455)

24.53%

Other expenses

(139,265)

(21,792)

539.06%

Other income

5,904

5,191

13.74%

Operating profit

623,273

1,013,599

-38.51%

Finance costs

(1,796,829)

(860,091)

108.91%

Profit before taxation

(1,173,556)

153,508

 

Taxation

485,512

70,065

592.9%

Net profit for the year

(688,044)

223,573

 

Basic and diluted earnings per share

(2.23)

0.75

 

 

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Posted on: 2020-04-27T12:49:00+05:00

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