DG Khan Cement’s net earnings topple on account of shooting finance cost

April 24, 2019 (MLN): DG Khan Cement Company (DGKC)’s nine months’ cumulative earnings have logged in at Rs.2.5 billion (EPS: Rs.5.71) marking a 47% decline in net earnings for the period ended March 31, 2019, as compared to the corresponding period of last year.

Against the backdrop of a weakened economy, the drop in net profit can be attributed to considerable year-on-year depreciation in the value of PKR, the rise in gas tariff, 20% YoY rise in FED and higher finance cost owing to the capitalization of Hub Plant.

The company’s topline earnings (Rs.32.6 billion) grew by 28% over the year, but when coupled with the heightened sales cost worth Rs.27.4 billion, the company’s gross profit declined by 28%, YoY.

A considerable enhancement in finance cost which stands at Rs.2.5 billion against last year’s figure of Rs.339 million, has played a major part in weighing down the overall earnings of DGKC.

Consolidated Profit and Loss Account for the nine months ended March 31, 2019 ('000 Rupees)

 

Mar-19

Mar-18

% Change

Sales

                      32,609,651

                      25,395,325

28.41%

Cost of sales

                    (27,419,503)

                    (18,149,001)

51.08%

Gross profit

                        5,190,148

                        7,246,324

-28.38%

Administrative expenses

                          (545,122)

                          (514,243)

6.00%

Selling and distribution expenses

                      (1,025,500)

                          (706,839)

45.08%

Other operating expenses

                          (639,200)

                          (824,907)

-22.51%

Other income

                        1,823,001

                        1,659,492

9.85%

Profit / (loss) from operations

                        4,803,327

                        6,859,827

-29.98%

Finance cost

                      (2,457,596)

                          (339,008)

624.94%

Profit befor taxation

                        2,345,731

                        6,520,819

-64.03%

Taxation

                            155,037

                      (1,780,216)

-108.71%

Profit after taxation

                        2,500,768

                        4,740,603

-47.25%

Earnings per share – basic and diluted (Rupees)

                                   5.71

                                 10.82

-47.23%

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Posted on: 2019-04-24T13:14:00+05:00

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