Gul Ahmed Textile reports two-fold increase in first quarter profits

By MG News | October 27, 2020 at 10:28 AM GMT+05:00

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October 27, 2020 (MLN): Gul Ahmed Textile Mills Limited (GATM) has posted a two-fold increase in net profits to Rs 697 million with earnings per share at Rs 1.63 per share for the three months ended on September 30, 2020 against net profits of Rs 346 million (EPS: Rs 0.81) of the corresponding period last year.

More than 100% increase in profits was mainly attributable to the strong demand and rise in export orders as the company witnessed revenue of Rs 20.32 billion against Rs 14 billion in the same period last year, recording a growth of 36% YoY. However, gross margin has been squeezed from 21% to 18% in 1QFY21 owing to a higher cost of sales (up by 40.6% YoY).

On the cost side, the total Operating cost of the company declined by 9% YoY to Rs 1.976 billion in 1QFY21.

During the period, finance cost rose by 56%YoY to Rs 591 million on account of higher working capital requirements.

Consolidated Profit and Loss statement for the quarter ended September 30, 2020 ('000 Rupees)
	Sep-20	Sep-19	% Change
Sales-net	20,322,550	14,931,102	36.11%
Cost of sales	(16,626,029)	(11,824,125)	40.61%
Gross profit	3,696,521	3,106,977	18.97%
Distribution costs	(1,112,460)	(1,126,251)	-1.22%
Administrative cost	(754,989)	(984,148)	-23.29%
Other operating cost	(109,509)	(58,634)	86.77%
Total Operating cost	(1,976,958)	(2,169,033)	-8.86%
	1,719,563	937,944	83.33%
Other income	(188,144)	(47,410)	296.84%
Operating profit	1,531,419	890,534	71.97%
Finance costs	(591,302)	(378,491)	56.23%
Profit before income tax	940,117	512,043	83.60%
Income tax	(242,959)	(165,153)	47.11%
Profit after income tax	697,158	346,890	100.97%
Earnings per share - basic and diluted (Rupees)	1.63	0.81	101.23%

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