Amreli Steels suffers drop in net earnings by 98%

MG News | September 12, 2019 at 03:46 PM GMT+05:00

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September 12, 2019 (MLN): Amreli Steels Limited has declared net earnings of Rs. 32.8 million (EPS: Rs. 0.11) for the year ended June 30, 2019, which is around 98% lower than the earnings reported in last year.

According to the details provided by Arif Habib Limited, the company endured significant slump in profits despite increase in sales revenue by 85%, which was prompted by rise in sale of rebars post commissioning of the new Dhabeji plant.

The gross profits of the company fell by 12% due to hike in scrap prices, teething issues at the new plant which led to higher gas and electricity costs, as well as consultancy and staff training costs incurred for the new plant.

The decline in profits was further triggered by increase in finance cost by 165%, owing to surge in the working capital requirement of the company.

Profit and loss account for the half year ended June 30, 2019 (Rupees)
	June, 2019	June, 2018	% Change
Sales	28,595,975,992	15,500,542,721	84.48%
Cost of sales	-26,172,391,685	-12,742,134,429	105.40%
Gross profit	2,423,584,307	2,758,408,292	-12.14%
Distribution costs	-716,485,273	-385,733,038	85.75%
Administrative expenses	-501,349,098	-401,410,506	24.90%
Other expenses	-17,703,942	-123,053,961	-85.61%
Other income	7,096,063	22,543,009	-68.52%
Operating profit	1,195,142,057	1,870,753,796	-36.11%
Finance costs	-1,262,303,022	-476,323,111	165.01%
(Loss) / profit before taxation	-67,160,965	1,394,430,685
Taxation	99,984,428	190,805,976	-47.60%
Net profit for the year	32,823,463	1,585,236,661	-97.93%
Earnings per share — basic and diluted	0.11	5.34	-97.94%

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