DGKC reports a massive 80% decline in net losses in 1QFY21

October 23, 2020 (MLN): D. G. Khan. Cement (DGKC) has announced its financial results for the 1QFY21 ended September 30, 2020, wherein the company reported a net loss of Rs 293 million (LPS: Rs 0.67), depicting a massive 80% YoY decline against a net loss of Rs 1.44 billion (LPS: Rs 3.30) in the corresponding period last year.

As per the financial statement issued by the company to PSX, topline witnessed a 16% YoY increase on an account of a jump in total dispatches to 1,897k tons together with the recovery in retention prices. This, alongside soft coal prices (USD 60/ton CNF in 1QFY21) also offset the impact of PKR depreciation and turned gross margins green at 10% vis-à-vis -5% in SPLY, the research report by Arif Habib highlighted.

As a result of this, the gross profits of the company reached Rs 1.125 billion in 1QFY21 against the gross loss of Rs 489 million reported in 1QFY20.

The major highlight is finance cost which decreased by around 40% YoY to Rs 830 million owing to the reduction in the policy rate to 7%, compressing the loss in the period under review.  Moreover, a decrease in tax expenses by 86% YoY also contributed to the financial performance of the company.

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