National Foods’ bottom-line profits grow in the wake of tax reductions

As per the financial earnings’ results for the year ended on June 30th 2018, National Foods Limited gained 5.5% in annual profits, saved by substantial tax reduction.

The company conducted its Board of Directors meeting on September 6th 2018 in which the earnings for the above mentioned period were reviewed and a year-on-year comparison was drawn.

According to the reports issued to PSX, the company’s sales went up by 28% during the year, whereas Gross Profits increased by 23%.

However, since all the expenses grew, including distribution cost which went up from Rs.3.5 billion to Rs.4.2 billion YoY, profits before taxation dropped by 11%.

Luckily for National Foods, net tax provisions were reduced by 57% this year, resulting in 5.5% increment in bottom-line profits as they increased from Rs.973.3 million during the year ended June 30th 2017, to Rs.1 billion during the last year ended.

The company’s basic and diluted earnings per share increased from Rs.9.2 per share to Rs.9.74 per share, YoY.

Apart from this, the board recommended a final cash dividend at Rs.3.75 per share, i.e. 75%.

They further recommended to issue bonus shares in the proportion of one share for every five shares held i.e. 20%.

Consolidated Financial Results for the Year Ended 30th June 2018 ('000 Rupees)

 

Jun-18

Jun-17

% Change

Sales

                       21,591,559

                       16,815,974

28.40%

Cost of sales

                     (14,887,820)

                     (11,383,196)

30.79%

Gross profit

                          6,703,739

                          5,432,778

23.39%

Distribution cost

                       (4,244,652)

                       (3,478,494)

22.03%

Administrative expenses

                           (913,220)

                           (520,221)

75.54%

Other expenses

                           (230,198)

                           (109,287)

110.64%

Other income

                                53,467

                                98,997

-45.99%

Operating profit

                          1,369,136

                          1,423,773

-3.84%

Finance costs

                           (195,728)

                           (104,817)

86.73%

Profit before taxation

                          1,173,408

                          1,318,956

-11.04%

Taxation – net

                           (146,374)

                           (345,666)

-57.65%

Profit after tax

                          1,027,034

                             973,290

5.52%

Basic and diluted earnings per share – Rupees

                                    9.74

                                    9.20

5.87%

 

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Posted on: 2018-09-07T09:46:00+05:00

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