Cherat Cement witnesses turnround in bottom-line in 1QFY21

MG News | October 23, 2020 at 02:13 PM GMT+05:00

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October 23, 2020 (MLN): Cherat Cement company Limited’s net profits which were negative in 1QFY20, turned positive in 1QFY21, as the company has posted net profits of Rs 309 million against the net loss of Rs 338.5 million.

This reflected in company earnings per share which stood at Rs 1.59 compared to negative Rs 1.74 in the same quarter last year.

The profitability of company can be attributed to improvement in local dispatches and better retention prices.

During the quarter, the company witnessed 16.4% YoY uptick in net revenues on the back of higher retention prices, while its variable cost went down by 4.3% YoY. This resulted in a higher gross margin which improved to 21% from 4% in the corresponding quarter last year.

On the cost side, the company observed 1.28% drop in distribution expenses, 13.58% decline in admin expenses and 12% decline in financial charges owing to cut in policy rate, however, 62% decline in other income due to lower dividend income put a constraint on company’s profitability.

Moreover, the company’s effective tax rate for the quarter stood at 26%.

Financial results for the Quarter ended September 30, 2020 ('000 Rupees)
	Sep-20	Sep-19	% Change
Turnover - net	5,217,144	4,480,510	16.44%
Cost of sales	(4,105,793)	(4,292,292)	-4.34%
Gross profit	1,111,351	188,218	490.46%
Distribution costs	(90,436)	(91,612)	-1.28%
Administrative expenses	(62,242)	(72,023)	-13.58%
Other expenses	(24,822)	(2,602)	853.96%
Other income	8,004	20,999	-61.88%
Operating profit	941,855	42,980	2091.38%
Finance costs	(522,008)	(593,908)	-12.11%
(Loss)/Profit before taxation	419,847	(550,928)	-
Taxation	(110,729)	(212,415)	-47.87%
Net (loss)/ profit for the period	309,118	(338,513)	-
(Loss)/Earnings per share - basic and diluted (Rupees)	1.59	(1.74)	-

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