December 30, 2020 (MLN): Attock Cement Pakistan Limited recently conducted its corporate briefing in which the management discussed the latest financial performance as well as a future roadmap.
During FY20, the company reported a 23.8% YoY increase in net profits to Rs 2.6 billion for the year ended on June 30th, 2020, compared to the profits of Rs 2 billion secured last year. Whereas, the earnings per share of the company exhibited a decline of 4.37% YoY from Rs 15.09 to Rs 14.43. The weak demand during COVID-19 lockdown and weak retail prices along with higher distribution expense in the backdrop of a higher share of exports kept the company’s profits in check.
To recall, the company’s financial performance for the quarter ended on September 30, 2020, showed an increase in the net profits by 64% to Rs 691.7 million, as compared to Rs 421 million reaped in the corresponding period of last year.
According to the key takeaways of the briefing covered by Taurus Securities, the management stated that Clinker production for the periods 1QFY21 and FY20 was 0.756 million and 2.83 million tons respectively whereby the major export destinations of clinker include Bangladesh, East Africa, and China.
The management claimed that the decrease in production and dispatch level was mainly on account of Covid-19 which affected the overall economic activity. All three production lines were shut off for 8days straight. However, ACPL is currently operating at full capacity and the management seems to be optimistic about future demand growth.
During the briefing session, the management said that ACPL’s export revenue is the highest in the industry during FY20 i.e. 1.16 million tons. However, the management expects that the re-enactment of Anti-dumping duty at 40% to South Africa will affect exports.
Commenting on the growth of the company, the management stated that the company has signed a tripartite agreement with PROTECH, XINJIANG TBEA Automatic Equipment Co. Ltd, China and LONGI Solar Technology Co. Ltd China along with Attock Energy Limited as lead consultant for erection, procurement and commissioning of 20MW Solar Power Plant.
The management said that the plant is expected to come online in 1QFY22. Currently, the per-unit cost of KE stands at PKR16 as per the report by Spectrum Securities Limited. The addition of the solar plant will reduce the reliance on the grid, resulting in a reduction in power cost. The company is also looking for alternate fuels to minimize the impact of rising coal prices.
The management clarified that export-related power tariff relief is not implemented yet, the report highlighted.
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