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LOTCHEM’s profits grow by 2x YoY on higher PTA-PX margin

August 05, 2022 (MLN): Lotte Chemical Pakistan Limited (LOTCHEM) has earned a net profit of Rs5.4 billion (EPS: Rs3.57) for the first half of CY22 ended June 30, 2022, depicting a robust growth of 2.08 times YoY due to increase in PTA-PX margin and depreciation of PKR against USD.

Along with the results, the company also announced a cash dividend of Rs4 per share.

The company is the only manufacturer and supplier of Purified Terephthalic Acid (PTA) for domestic polyester and polyethylene terephthalate (PET) markets in Pakistan.

In 1HCY21, the company witnessed net profits of Rs2.6bn with earnings per share at Rs1.72.

According to the financial results sent to Exchange, the top line witnessed an upsurge of 62% YoY to Rs50bn mainly led by robust demand from textile sectors and a rise in PTA prices. Accordingly, the company posted a gross profit of Rs10bn, up by 2.6xYoY.

The gross margins of the company clocked in at 20% compared to 13% during the same period last year, mainly due to higher PTA-PX realized margins.

On the cost front, LOTCHEM’s major expense head i.e., administrative and general expenses went up by 10% YoY to Rs251mn while distribution cost surged by 26% YoY during the period under review.

Among other lined items, other income of the company increased by 59% YoY due to higher interest rates.

On the other hand, the company’s financial charges ballooned by 5 times YoY to Rs997mn amid higher interest rates and increased working capital costs.

On the taxation front, the effective tax rate for 1HCY22 stood at 39% when compared to 29% in the same period last year.

Profit and Loss Account for the Half-year ended June 30, 2022 ('000 Rupees)

 

Jun-22

Jun-21

% Change

Revenue -net

 49,958,303

 30,922,244

61.56%

Cost of Sales

 (39,952,417)

 (27,009,923)

47.92%

Gross Profit

 10,005,886

 3,912,321

155.75%

Distribution and Selling Expenses

 (73,124)

 (58,032)

26.01%

Administrative and general expenses

 (251,400)

 (229,424)

9.58%

Other operating expenses

 (668,090)

 (275,290)

142.69%

Other Income

 833,743

 525,188

58.75%

Finance costs

 (997,649)

 (201,441)

395.26%

Profit before taxation

 8,849,366

 3,673,322

140.91%

Taxation

 (3,447,919)

 (1,071,458)

221.80%

Profit after taxation

 5,401,447

 2,601,864

107.60%

Earnings per share – Basic and Diluted (Rs)

 3.57

 1.72

107.56%

 

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Posted on:2022-08-05T16:19:16+05:00

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