Earning Review: Kohat Cement's margins undergo decline amid PKR depreciation
MG News | September 30, 2019 at 03:57 PM GMT+05:00
September 30, 2019 (MLN): Kohat Cement Company Limited (KOHC), holding a good market position in Cement industry has posted 17% YoY in consolidated net profits after tax to Rs 2.46 billion (EPS: Rs12.29) for the year ended June 30th 2019.
During FY19, industry dynamics especially for cement players operating in north region have shifted significantly on account of fluctuating cement prices, increase in FED on coal import and depreciation in Pak Rupee against other currencies. Along with these factors, slow local demand has affected the company's sales.
During the year, company’s sales witnessed 16.4% uptick whereby company's margins witnessed decline given PKR depreciation and price cuts in North.
On expenses side, company’s admin expenses surged by 25%, whereas distribution expenses by 22% on account of higher exports.
However, the company observed around 56.7% YoY decline in finance cost, the impact failed to elevate company’s profitability.
Along with the financial results, the board of directors of the company announced a final cash dividend for the aforesaid period at Rs. 2.5/-per share i.e. 25%.
| Profit and Loss Account for the year ended June 30, 2019 (Rupees) | |||
|---|---|---|---|
|
| Jun-19 | Jun-18 | % Change |
| Sales - net | 15,645,648,712 | 13,438,843,026 | 16.42% |
| Cost of goods sold | (11,439,567,516) | (9,113,482,181) | 25.52% |
| Gross profit | 4,206,081,196 | 4,325,360,845 | -2.76% |
| Selling and distribution expenses | (118,276,416) | (96,878,923) | 22.09% |
| Administrative and general expenses | (254,163,790) | (203,149,588) | 25.11% |
| Other operating income | 348,620,307 | 361,696,624 | -3.62% |
| Other operating expenses | (460,124,755) | (310,145,721) | 48.36% |
|
| (483,944,654) | (248,477,608) | 94.76% |
| Operating profit | 3,722,136,542 | 4,076,883,237 | -8.70% |
| Finance cost | (46,065,101) | (106,531,176) | -56.76% |
| Profit before taxation | 3,676,071,441 | 3,970,352,061 | -7.41% |
| Taxation | (1,207,415,551) | (990,357,268) | 21.92% |
| Profit after taxation | 2,468,655,890 | 2,979,994,793 | -17.16% |
| Earnings per share - basic and diluted (Rupees) | 12.29 | 14.84 | -17.18% |
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