ASTL sees six-fold increase in profits

October 26, 2021 (MLN): Amreli Steel Limited (ASTL) revealed the financial statement for the first quarter of the fiscal year 2022 today as per which the company posted an enormous profit of Rs701.86 million, climbed up by 6.3x YoY when compared to the same period last year (SPLY).

This resulted in to increase in the company’s earnings per share from Rs0.37 in 1QFY21 to Rs2.36 in 1QFY22.

Going by the financial statement sent to PSX, the company witnessed robust growth in the top line as it went up by 49.65%YoY to Rs11.84bn due to pent-up demand. Resultantly, the gross margins expanded from 11% to 14% amid a significant increase in local rebar prices from last year. The surge in rebar prices is due to an uptrend in global scrap prices average (USD467/ton) in 1QFY22, a research note by Darson Securities noted.

On the cost front, the distribution and administrative expenses surged by 18.56% and 53.5% YoY to stand at around Rs239mn and Rs177.59mn, respectively.

On the other hand, the finance cost of the company declined by 15% YoY to Rs387.70mn on the back of a decline in borrowing rate and loans repayment that helped in strengthening the bottom line.

However, the company booked a tax expense of Rs155.45mn during FY21 against a tax reversal of Rs60.17mn in 1QFY21.

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