Gul Ahmed profit falls 40% in first quarter

MG News | October 28, 2024 at 09:57 AM GMT+05:00

0:00

October 28, 2024 (MLN): Gul Ahmed Textile Mills Limited (PSX: GATM) posted a 40.2% decline in its net profit during the quarter ending September 2024 despite higher revenue.

The company earned a profit after tax of Rs356.94 million [EPS: Rs0.48] during Q1 FY25 compared to Rs596.79m [EPS: Rs0.81] recorded in the same period last year (SPLY).

Its shares slumped over 5% during intraday trade Monday.

The decline comes despite a higher revenue of Rs42.08bn as compared to Rs35.64bn in SPLY.

That was because the cost of sales surged by 21.7%, worsening the gross profit by 10.5% to Rs3.57bn in Q1 FY25.

Its gross margins fell to 8.5% as compared to 11.2% in SPLY.

During the period under review, other income marked an increase of 87.2% to stand at Rs943.81m in Q1 FY25 as compared to Rs504.26m in SPLY.

On the expense side, the company's administrative expenses fell 0.3% from a year ago to Rs947.02m, selling and distribution expenses rose 48.4% to Rs1.1bn, and other operating expenses fell 48.0% to Rs47.61m.

The company’s finance cost skyrocketed by 9.5% and stood at Rs1.74bn as compared to Rs1.59bn in SPLY, mainly due to higher interest rates.

On the tax front, the company paid a lower tax worth Rs315.22m against an expense paid worth Rs521.35m in the corresponding period of last year, a fall of 39.5%.

This translates to an effective tax rate of 46.9% as compared to 46.6% in SPLY.

Unconsolidated (un-audited) Financial Results for quarter ended September 30, 2024 (Rupees in '000)
	Sep 24	Sep 23	% Change
Sales	42,078,103	35,641,767	18.06%
Cost of sales	(38,509,492)	(31,652,884)	21.66%
Gross Profit/ (loss)	3,568,611	3,988,883	-10.54%
Administrative Expenses	(947,022)	(949,430)	-0.25%
Selling And Distribution Expenses	(1,104,047)	(743,861)	48.42%
Other Income	943,806	504,259	87.17%
Other Operating Expenses	(47,605)	(91,562)	-48.01%
Finance Cost	(1,741,584)	(1,590,148)	9.52%
Profit/ (loss) before taxation	672,159	1,118,141	-39.89%
Taxation	(315,224)	(521,354)	-39.54%
Net profit/ (loss) for the period	356,935	596,787	-40.19%
Basic earnings/ (loss) per share	0.48	0.81	-

Amount in thousand except for EPS

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