HCAR annual profits suffer a blow of 40%

MG News | May 20, 2019 at 12:40 PM GMT+05:00

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May 20, 2019 (MLN): Honda Atlas Cars (Pakistan) Limited (HCAR) has declared its financial accounts for the year ended March 31, 2019 in its Board of Directors meeting today, whereby the company’s net profit for the period is recorded at Rs.3.85 billion (EPS:26.97) which is 40% lesser than the net income recorded last year.

This result is in line with the market's expectation as various brokerage houses projected that the company would suffer a decline in annual net income.

The company’s overall sale during the period (Rs.95 billion) inched up by nearly 4% while due to PKR devaluation the cost of sales (Rs.87.8 billion) expanded by 8%, thus weighing down the gross profits (Rs.7.3 billion) by 30%, and gross margin by 374 basis points.

Additionally, due to overall expansion in other expenses and a substantial decline in non-core income, the company’s operating profits crashed by around 41%, YoY.

These outflows managed to outweigh the relief brought by declines in Finance costs (down by 22%) and taxation (down by 41%).

On another note, HCAR has decided to pay out a final cash dividend of Rs.12.15 per share, i.e. 121.5%, for this year end.

Profit and Loss statement for the year ended March 31, 2019 ('000 Rupees)
	Mar-19	Mar-18	% Change
Sales	95,128,289	91,522,872	3.94%
Cost of sales	(87,824,215)	(81,073,777)	8.33%
Gross profit	7,304,074	10,449,095	-30.10%
Distribution & marketing cost	(931,787)	(916,906)	1.62%
Administrative expenses	(800,040)	(677,602)	18.07%
Other operating income	1,313,522	1,883,025	-30.24%
Other operating expenses	(1,281,007)	(1,244,569)	2.93%
	(1,699,312)	(956,052)	77.74%
Profit from operations	5,604,762	9,493,043	-40.96%
Finance cost	(11,189)	(14,476)	-22.71%
Profit before taxation	5,593,573	9,478,567	-40.99%
Taxation	(1,742,460)	(2,984,117)	-41.61%
Profit after taxation	3,851,113	6,494,450	-40.70%
Earnings per share - basic and diluted	26.97	45.48	-40.70%

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