October 28, 2021 (MLN): Lucky Cement Limited (PSX: LUCK) has unveiled its financial performance for 1QFY22 today as per which the company posted a consolidated net profit of Rs8.86 billion, depicting an increase of 72.6% against the net profit of Rs5.13bn secured in the same period last year (SPLY).
Of Rs8.86bn, Rs6.65bn is attributable to owners of the holding company which translates into an EPS of Rs20.57 during the first quarter ended September 30, 2021, as compared to Rs13.45 in SPLY.
The increase in net profit was mainly attributable to an increase in profitability at Lucky Cement Limited on the back of higher local sales during the quarter under review.
The increase in consolidated net profit was also supported by a considerable increase in profitability of the Chemicals business due to improved sales volumes of Polyester, Pharma and Animal Health business segments at ICI Pakistan Limited. The net profit of the Chemicals business also increased on account of a one-time unrealized accounting gain recognized on the acquisition of controlling interest in NutriCo Pakistan (Pvt) Limited amounting to PKR1.847 billion.
Meanwhile, Lucky Motor Corporation also posted growth in profitability mainly on account of growth in sales revenue; whereas, the profitability of the Company's overseas operations increased mainly due to operations of the Company's Joint Venture Greenfield cement plant in Samawah, Iraq, which achieved its COD in March 2021.
To note, the industry-wide local sales volume registered a growth of 4.1% YoY to reach 11.29 million tons during the first quarter under review. Export sales volumes showed a large decline of 43.8% YoY to reach 1.54 million tons during 1Q 2021-22 As a result the total cement sales of the industry declined by 5.6% to 12.83 million tons during 1QFY22 due to a decline in export volumes on the back of increasing coal prices and freight costs internationally, which have adversely impacted the viability of cement exports from Pakistan.
Apart from this, some importing countries faced issues with their political and economic conditions, in addition to challenges already being faced due to Covid.
Accordingly, the company's local sales volumes grew by 3.7% to reach 1.73 million tons in comparison to 1.66 million tons during the same period last year, mainly due to sustained cement demand as a result of several initiatives taken by the Government to boost construction activities in the country. Moreover, the export sales volumes of the company decreased by 30.4% to 0.53 million tons, resulting in overall sales volumes declining by 7.0% to reach 2.26 million tons during 1Q 2021-22.
On a consolidated basis, LUCK achieved a gross turnover of Rs69.27 billion which is 19.7% higher as compared to the same period last year's turnover of Rs57.85 billion. As a result, the gross margins (as a percentage of gross revenue) clocked in at 16.84%, up by 1.67ppt during the said period.
On the costs front, Luck’s admin expenses swelled by 36.3% YoY while its distribution cost fell by 3% YoY during the period under review.
According to the financial statement, the company’s finance cost plunged by 20% YoY due to a lower interest rate regime. One of the positive highlights includes an increase in other income which surged by 4.38x YoY, strengthening the bottom line of the company.
|
Consolidated Profit and Loss for the Quarter ended September 30th, 2021 ('000 Rupees) |
|||
|---|---|---|---|
|
|
Sep-21 |
Sep-20 |
% Change |
|
Revenue |
69,269,156 |
57,850,843 |
19.7% |
|
Sales tax and excise duty |
(11,379,101) |
(7,886,485) |
44.3% |
|
Rebates, incentives and commission |
(2,908,522) |
(4,850,591) |
-40.0% |
|
Net sales |
54,981,533 |
45,113,767 |
21.9% |
|
Cost of Sales |
(43,320,001) |
(36,340,792) |
19.2% |
|
Gross Profit |
11,661,532 |
8,772,975 |
32.9% |
|
Distribution cost |
(2,211,085) |
(2,278,104) |
-2.9% |
|
Administrative expenses |
(1,631,355) |
(1,196,494) |
36.3% |
|
Finance cost |
(339,683) |
(425,619) |
-20.2% |
|
Other expenses |
(774,857) |
(483,944) |
60.1% |
|
Other income |
2,636,387 |
601,300 |
338.4% |
|
Share of profit- joint ventures and associates |
1,253,909 |
906,634 |
38.3% |
|
Profit before taxation |
10,594,848 |
5,896,748 |
79.7% |
|
Taxation |
|
|
|
|
current |
(1,832,144) |
(894,783) |
104.8% |
|
Deferred |
96,369 |
130,270 |
-26.0% |
|
|
(1,735,775) |
(764,513) |
127.0% |
|
Profit after taxation |
8,859,073 |
5,132,235 |
72.6% |
|
Earnings per share – Basic and Diluted (Rupees) |
20.57 |
13.45 |
52.9% |
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