Cherat Cement suffers Rs 1.89 billion loss on lower retention price

MG News | August 26, 2020 at 05:14 PM GMT+05:00

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August 26, 2020 (MLN): Cherat Cement Company Limited (CHCC) has announced its FY20 financial results, wherein the company reported a net loss of Rs 1.89 billion (LPS: Rs 9.74), as against a net profit of Rs 1.76 billion (EPS: PKR 9.07) in FY19.

According to the research of BIPL, the loss is attributed to gross margins attrition that clocked in at 2% in FY20, dropped by 16ppts on the back of lower retention price and higher energy cost.

The company’s net sales for FY20 recorded at Rs 17.09 billion, up 8% YoY. As per BMA research, an increase in topline was mainly driven by a 35% increase in volumetric sales; however, an increase in net sales was limited by lower realized prices.

The other major highlight is finance cost which ballooned by 2.2 times YoY to stand at Rs 2.52 billion in FY20.

Meanwhile, the company also recorded a tax reversal of Rs 829 million that lowered the loss during the year, BMA research added.

Consolidated Financial Results for the year ended June 30, 2020 ('000 Rupees)
	Jun-20	Jun-19	% Change
Turnover - net	17,090,155	15,862,647	7.74%
Cost of sales	(16,703,668)	(12,979,533)	28.69%
Gross profit	386,487	2,883,114	-86.59%
Distribution costs	(362,003)	(396,338)	-8.66%
Administrative expenses	(271,750)	(293,925)	-7.54%
Other expenses	(19,025)	(109,360)	-82.60%
	(652,778)	(799,623)	-18.36%
Other income	70,561	106,836	-33.95%
Operating (loss)/profit	(195,730)	2,190,327	-
Finance costs	(2,526,997)	(1,142,559)	121.17%
(Loss)/Profit before taxation	(2,722,727)	1,047,768	-
Taxation	829,619	714,995	16.03%
Net profit for the year	(1,893,108)	1,762,763	-
(Loss)/Earnings per share - basic and diluted (Rupees)	(9.74)	9.07	-

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