Earnings Preview: DGKC to suffer declines in PAT due to higher production and finance cost

By MG News | February 25, 2019 at 05:18 PM GMT+05:00

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February 25, 2019: The Board meeting of DG Khan Cement Limited (DGKC) is scheduled to take place on Tuesday, February 26, 2019 to unveil the company’s financial results for the period ended on December 31, 2018.

Based on estimations from various brokerage houses, the market expects DGKC’s profit after tax for 1HFY19 to be clocked in between Rs. 1 billion to Rs. 1.5 billion, while in 2QFY19, the company is likely to report a profit in between Rs 0.5 billion to Rs 1.2 billion with EPS ranging from Rs 1.2 to Rs 2.6.

The estimate projections by various brokerage houses are shown in the table below:

Brokerage House	2QFY19	EPS (% Change over year)	1HFY19	EPS (% Change over year)
Pearl Securities Limited	Rs.0.64 billion	Rs.1.46 (-29%)	Rs.1.06 billion	Rs.2.42 (-72%)
Spectrum Securities Limited	Rs.1.05 billion	Rs.2.41 (18%)	Rs.1.4 billion	Rs.3.37 (-60.5%)
Arif Habib Limited	Rs.0.54 billion	Rs.1.25 (-39%)	Rs.0.96 billion	Rs.2.21 (-74%)
JS Global Capital Limited	Rs.1.12 billion	Rs.2.57 (26%)	Rs.1.5 billion	Rs.3.52 (-59%)

The market expects accretion in revenue on the back of higher dispatches due to rise in both local sales and exports.

However, gross margin is estimated to go down due to a surge in coal price and PKR depreciation.

The decline in earnings can be accredited to margin abrasion on account of higher production cost and rise in finance cost.

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