Equity

Atlas Honda’s net earnings shrink by 10.8% to Rs 2.24 bln

January 24, 2020

ATLH: Bottom line turns green at Rs1.3bn in 4QFY21

January 24, 2020 (MLN): Atlas Honda Limited (ATHL) has announced its financial results for the nine months ended on December 31, 2019. As per the results, the company has witnessed the decline in its net earnings by 10.8% to Rs 2.24 billion against Rs 2.51 billion of the same period last year.

During the period, the sales revenue were up by 5.8% YoY, but more than a proportionate increase in the cost of sales made the gross profits decline by 8.2% YoY. Therefore, the gross margin shrunk from 8.5% to 7.16%.

More notably, the company bore 7.7% YoY sales and marketing expenses from Rs. 1.39 billion to Rs. 1.5 billion. The share of profit of associated companies plunged by 70.7% YoY to clock at Rs 3.8 million. However, other income increased by 34.5% YoY owing to an increase in income from financial assets.

Further, the finance cost surged by 59.2% YoY to Rs 22 million when compared to the prior year owing to the higher interest rate during the period under review.

ATHL’s basic and diluted earnings per share have been reported at Rs 18.07 per share while those recorded last year were Rs 20.26 per share.

Profit and Loss for the nine months ended December 31, 2019 ('000 Rupees)
	Dec-19	Dec-18	% Change
Sales	64,054,924	60,537,895	5.8%
Cost of Sales	(59,470,002)	(55,545,270)	7.1%
Gross Profit	4,584,922	4,992,625	-8.2%
Sales and Marketing Expenses	(1,503,891)	(1,396,404)	7.7%
Administrative expenses	(486,313)	(462,917)	5.1%
Other income	925,452	687,988	34.5%
Other operating expenses	(248,410)	(262,945)	-5.5%
Share of profit of an associate – net of tax	3,893	13,271	-70.7%
Profit from operations	3,275,653	3,571,618	-8.3%
Finance Cost	(22,164)	(13,926)	59.2%
Profit before taxation	3,253,489	3,557,692	-8.6%
Taxation	(1,010,814)	(1,043,817)	-3.2%
Profit after taxation	2,242,675	2,513,875	-10.8%
Earnings per share – Rs.	18.07	20.26	-10.8%