GATM's 1HFY24 profit after tax drops to Rs1.09bn

February 27, 2024 (MLN): Gul Ahmed Textile Mills Limited (PSX: GATM) unveiled its profitability for 1HFY24, wherein the profit after tax dropped to Rs1.09 billion [EPS: Rs1.47] compared to a profit of Rs2.18bn [EPS: Rs2.94] in the same period last year (SPLY).

Going by the results, the company's top line surged by 34.81% YoY to Rs83.74bn as compared to Rs62.11bn in SPLY.

The cost of sales rose by 38.74% YoY but was lesser than proportionate to sales decline, which improved the gross profit by 17.41% YoY to Rs13.45bn in 1HFY24.

However, the growth in the gross profit of GATM was not significant enough to outweigh the rise in operating and finance costs, due to which the company recorded a drop in its earnings.

The operating expenses of the company reached Rs7.93bn in 1HFY24, comparatively up by 20.8% YoY compared to the figure incurred in 1HFY23.

On the other hand, the other income section of the profit and loss statement shows that inflows contracted by 15.44% YoY to Rs911.74m in 1HFY24.

Further pressure came through a massive 63.01% YoY rise in GATM's finance costs, which stood at Rs4.33bn as compared to Rs2.66bn in SPLY, mainly due to higher interest rates.

On the tax front, the company paid a lower tax worth Rs1.01bn against the Rs1.13bn paid in the corresponding period of last year, depicting a fall of 10.95% YoY.

Amount in thousand except for EPS

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