Millat Tractors earns 64% higher profit of Rs2.1bn

September 09, 2024 (MLN): Millat Tractors Limited (PSX: MTL) recorded an increase of 64.4% in its profits, with the company's after-tax profits rising to Rs2.06 billion [EPS: Rs10.72], compared to a profit of Rs1.25bn [EPS: Rs6.52] in the same period last year (SPLY).

To note, the board of directors and shareholders of the company have approved the scheme for merger of Millat Tractors Limited with Millat Equipment Limited (MEL). Approval of the scheme of arrangement by the Lahore High Court, Lahore (LHC) is still pending.

According to the terms of the scheme, MTL is not permitted to pay any dividends until the LHC grants approval of the merger.

Therefore, for the financial year ended June 30, 2024, the total cash dividend will be limited to the interim dividend of Rs25 per share i.e. 250% which has already been paid.

The board may consider approval of dividend subsequent to the merger of two companies, it said in a stock filing on Monday.

Going by the results, the company's sales revenue rose 57.8% to Rs21.93bn as compared to Rs13.89bn in SPLY.

The cost of sales also rose by 67.9% but was lesser than proportionate to sales rise, which improved the gross profit by 28.4% to Rs4.54bn in Q4 FY24.

The gross margins, however, fell to 20.7% as compared to 25.4% in SPLY.

During the period under review, other income decreased 60.5% to stand at Rs40.15m in Q4 FY24 as compared to Rs101.73m in SPLY.

On the expense side, the company's administrative expenses rose 48.8% from a year ago to Rs329.86m, while selling and distribution expenses rose 41.5% to Rs311.25m.

The company’s finance cost inched down by 0.3% and stood at Rs527.26m as compared to Rs528.93m in SPLY.

On the tax front, the company paid a higher tax worth Rs1.53bn against the Rs1.28bn paid in the corresponding period of last year, depicting an increase of 19.4%.

However, the effective tax rate fell to 42.6% as compared to 50.6% in SPLY.

Amount in thousand except for EPS

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