August 9, 2021 (MLN): Lucky Cement Limited (PSX: LUCK) has disclosed its financial performance for FY21 today as per which the company posted net profits of Rs28.2bn, up by a whopping 3.85x against the profits of Rs7.3bn secured in the previous fiscal year.
Of Rs28.2bn, Rs22.86bn is attributable to owners of the holding company which translates into an EPS of Rs70.69 during FY21 as compared to Rs18.96 in last year.
The YoY accretion in the company’s bottom-line can be accredited to better retention prices, an increase in volumetric sales on the back of a sharp recovery in construction activities following government incentives, and a jump in the profitability of all the group companies.
To highlight, Cement Industry in Pakistan grew by 20.1% to 57.45 million tons during FY21 in comparison to 47.81 million tons during the same period last year. The local sales volume registered a healthy growth of 20.4% to reach 48.13 million tons during the year under review versus 39.97 million tons during last year. Export sales volumes also registered an increase of 18.7% to reach 9.31 million tons during the year compared to 7.85 million tons during last year.
Accordingly, net sales of the company during the year surged by 67.4% YoY mainly on account of availability of newly commissioned increased capacity of Line 1 for the full year versus six months during the corresponding period and increase in cement demand as LUCK’s local offtake soared by 20.4% and export offtake by 18.7%. Moreover, better retention price amid low discounts and increase in MRP, and a reduction in FED by Rs25/bag also lifted the company’s sales.
Higher export sales volume during the period is mainly attributed to the export of loose cement owing to strategic identification of new markets and product placement, keeping in view better margins and LUCK’s unique position to make such sales. Lucky Cement is the only company in Pakistan to have a state-of-the-art mechanized facility at the port to export loose cement.
Despite increase in the cost of sales by 52% YoY, robust domestic sales along with higher retention price (up 27% YoY) as well as enhanced cost efficiency from the new line, expanded the gross profits by twofold to clock in at Rs47.54bn. The gross margin clocked in at 23% against 15% in FY20.
On the costs front, Luck’s admin expenses swelled by 30.5 YoY while its distribution cost rose by 31% YoY owing to the high proportion of sea exports & local dispatches.
Additionally, a heavy dividend income of Rs4.4bn from Lucky Motors Corporation, ICI, and Yunus Energy in the third quarter is another major reason for this accretion in earnings during the year.
|
Consolidated Profit and Loss for the Year ended June 30, 2021 ('000 Rupees) |
|||
|---|---|---|---|
|
|
Jun-21 |
Jun-20 |
% Change |
|
Revenue |
267,725,109 |
162,868,206 |
64.4% |
|
Sales tax and excise duty |
(50,261,392) |
(32,210,557) |
56.0% |
|
Rebates and commision |
(10,304,844) |
(6,890,060) |
49.6% |
|
Net sales |
207,158,873 |
123,767,589 |
67.4% |
|
Cost of Sales |
(159,613,718) |
(104,810,654) |
52.3% |
|
Gross Profit |
47,545,155 |
18,956,935 |
150.8% |
|
Distribution cost |
(10,021,626) |
(7,648,737) |
31.0% |
|
Administrative expenses |
(5,509,068) |
(4,221,555) |
30.5% |
|
Finance cost |
(1,463,781) |
(2,367,101) |
-38.2% |
|
Other expenses |
(4,915,446) |
(1,203,342) |
308.5% |
|
Other income |
2,927,644 |
2,376,253 |
23.2% |
|
Share of profits- joint ventures and associates |
4,438,860 |
3,038,446 |
46.1% |
|
Profit before taxation |
33,001,738 |
8,930,899 |
269.5% |
|
Taxation |
|
|
|
|
current |
(3,865,870) |
(2,113,459) |
82.9% |
|
Deferred |
(906,944) |
499,767 |
-281.5% |
|
|
(4,772,814) |
(1,613,692) |
195.8% |
|
Profit after taxation |
28,228,924 |
7,317,207 |
285.8% |
|
Earnings per share – Basic and Diluted (Rupees) |
70.69 |
18.96 |
272.8% |
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