Millat Tractors suffers 40% decline in profits due to lower sales and higher expenses

February 14, 2019 (MLN): Millat Tractors Limited (MTL) has announced its net income for the half year ended December 2018 at Rs.1.8 billion (EPS: Rs.41.11), a fall of over 40% from the net earnings of Rs.3 billion (EPS: Rs.69.10) recorded for the same period last year.  

The company’s topline (Rs.15.4 billion) toppled over by more than Rs.3.3 billion (or 17.5% YoY), consequently weighing down the gross profits (Rs.3.5 billion) by nearly 33% as although the cost of sales did reduce its decline was insufficient to cover for the lost sales.

The negative impact gathered more weight as the overall expenses marked a rise of Rs.106.4 million and finance cost (Rs.47.6 million) grew by Rs.39 million over the year.

While decrease in tax payments worth Rs.565.9 million provided some relief to the company, it was not enough to prevent a fall in profits.

Apart from this, the Board of MTL has recommended an Interim Cash Dividend at Rs.45 per share, i.e. 45%.

Consolidated profit and loss account for the half year ended Dec 31st 2018 ('000 Rupees)

 

Dec-18

Dec-17

% Change

Sales- net

                     15,399,093

                     18,666,490

-17.50%

Cost of sales

                     11,912,414

                     13,473,401

-11.59%

Gross profit

                        3,486,679

                        5,193,089

-32.86%

Distribution and marketing expenses

                           345,339

                           348,636

-0.95%

Administrative expenses

                           401,662

                           364,105

10.31%

Other operating expenses

                           427,335

                           355,167

20.32%

 

                        1,174,336

                        1,067,908

9.97%

Other income

                           366,595

                           320,210

14.49%

Operating profit

                        2,678,938

                        4,445,391

-39.74%

Finance costs

                              47,657

                                8,600

454.15%

Profit before tax

                        2,631,281

                        4,436,791

-40.69%

Taxation

                           810,307

                        1,376,173

-41.12%

Profit for the year

                        1,820,974

                        3,060,618

-40.50%

Basic and diluted earnings per share (Rupees)

                                41.11

                                69.10

-40.51%

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Posted on: 2019-02-14T13:02:00+05:00

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