April 22, 2021 (MLN): Kohinoor Textile Mills Limited (LTML) has witnessed a phenomenal turnaround in net profits which clocked in at Rs7.83bn during 9MFY21, compared to the net loss of Rs1.98bn incurred in the same period last year.
This reflected in earnings per share of the company which clocked in at Rs19.88/sh against loss per share of Rs2.37/sh last year.
During the period under review, Company’s revenues increased by 15.9% to Rs47.6bn, while the cost of sales remained flat at Rs37bn. This resulted in a gross profit of Rs10.7bn, up by 2.5x YoY.
The gross margin of the company improved to 23% from 10% in SPLY as a timely purchase of raw materials at competitive prices and the global shortage of imported fine-count yarns helped improve margins. Moreover, the Company has covered its needs for cotton for the remainder of the financial year and beyond, which will positively impact profits going forward.
In addition to this, the company is also planning capacity expansions in their spinning and weaving divisions according to the report by Insight Securities. This, combined with their phenomenal profits during the review period, will provide a major boost to their operational efficiencies and gross margins.
On the expense side, the administrative cost and distribution cost jumped by 10.4% and 25.7% YoY respectively. However, the positive highlight is the 8.9x upsurge in other income to Rs4bn during 9MFY21 which supported KTML to turn its losses into profits.
Moreover, a decline of 45.6% YoY in finance cost further provided much-needed respite to the bottom line due to lower short-term borrowings as well as the lower interest rates.
|
Consolidated Financial Results for Nine months ended March 31, 2021 ('000 Rupees) |
|||
|---|---|---|---|
|
|
Mar-21 |
Mar-20 |
% Change |
|
Revenue |
47,668,710 |
41,114,732 |
15.9% |
|
Cost of sales |
(36,937,592) |
(36,843,032) |
0.3% |
|
Gross profit |
10,731,118 |
4,301,700 |
149.5% |
|
Distribution cost |
(1,602,262) |
(1,274,793) |
25.7% |
|
Administrative expenses |
(1,292,010) |
(1,170,145) |
10.4% |
|
Other expenses |
(599,688) |
(1,331,002) |
-54.9% |
|
|
(3,493,960) |
(3,775,940) |
-7.5% |
|
|
7,237,158 |
525,760 |
1276.5% |
|
Other income |
4,094,103 |
460,566 |
788.9% |
|
Profit from operations |
11,331,261 |
986,326 |
1048.8% |
|
Finance cost |
(1,592,767) |
(2,926,483) |
-45.6% |
|
Profit before taxation |
9,738,494 |
(1,940,157) |
|
|
Taxation |
(1,902,814) |
(40,070) |
4648.7% |
|
Profit after taxation |
7,835,680 |
(1,980,227) |
|
|
Earnings per share – Basic and Diluted (Rupees) |
19.88 |
(2.37) |
|
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