High operating costs cut down BATA profits by 12%

MG News | October 30, 2018 at 10:49 AM GMT+05:00

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October 30, 2018 (MLN): Bata Pakistan Limited (BATA) has announced profits of Rs. 792 million for the nine months ended 30^th September 2018, 12.39% down as compared to the corresponding period last year. The downturn was a result of boosted operating expenses coupled with falling non-core income.

According to the notification issued to PSX, the top-line earnings of the company showed a slight improvement of 6.37%, as well as the cost of sales that grew by merely 5.27%, causing the Gross Profits to increase by 7.89%

However, it was the growth in Distribution cost (13.58%), Administrative cost (10.64%), other expenses (8.8%) along with a fall in non-core income (42.2%) that led to a smothered financial stability.

Furthermore, the increase in Finance cost by 12.51% also contributed in the company’s sliding profits.

The Earnings per share were stated at Rs. 104.79 for the nine months ended 30^th September 2018.

The company announced a Cash dividend of 900 (Rs. 90/- per share)

Profit and loss account for the nine months ended September 30th 2018 (Rupees’000)
	Sep-18	Sep-17	% Change
SALES	11,764,772	11,059,871	6.37%
COST OF SALES	6,734,640	6,397,509	5.27%
GROSS PROFIT	5,030,132	4,662,362	7.89%
Distribution cost	2,854,490	2,513,177	13.58%
Administrative expenses	803,156	725,950	10.64%
Other expenses	120,169	110,447	8.80%
OTHER INCOME	34,140	59,064	-42.20%
FINANCE COST	34,899	31,018	12.51%
PROFIT BEFORE TAXATION	1,251,558	1,340,834	-6.66%
PROVISION FOR TAXATION
Current	450,422	458,350	-1.73%
Deferred	8,913	-21,747
PROFIT AFTER TAXATION	792,223	904,231	-12.39%
EARNINGS PER SHARE- BASIC AND DILUTED	104.79	119.61	-12.39%

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