Pak Suzuki suffers losses owing to higher production cost

MG News | October 25, 2019 at 05:29 PM GMT+05:00

0:00

October 25, 2019 (MLN): Pak Suzuki Motors Company (PSMC) has announced its financial results for the nine months ended on September 30^th 2019, wherein the company has reported huge losses of Rs 2.68 billion against the profits of Rs 1.39 billion earned in the same period last year.

The loss per share for the period recorded at Rs 32.64 per share.

Pak Suzuki incurred losses mainly on the back of higher production cost and the inability of the company to pass on the rising costs to customers, as volumetric sales already on a downward trend.

The gross margins of the company shrank from 7% to 1% on account of currency depreciation and higher duties on the imported raw material.

Furthermore, the finance costs of the company skyrocketed by 771% YoY owing to rise in borrowings to meet working capital requirement.

During the period, due to deteriorating cash position of the company, its other income fell considerably by 69% which further dragged the company’s earnings into negative territory.

Profit and Loss Account for the nine months ended September 30, 2019 ('000 Rupees)
	Sep-19	Sep-18	% Change
Turnover	91,065,101	89,018,472	2%
Cost of sales	(89,924,783)	(82,962,438)	8%
Gross Profit	1,140,318	6,056,034	-81%
Distribution Cost	(2,142,356)	(2,073,639)	3%
Administrative expenses	(1,816,857)	(1,660,122)	9%
	(2,818,895)	2,322,273
Finance cost	(1,090,271)	(125,147)	771%
Other opertaing income	147,741	479,310	-69%
	(3,761,425)	2,676,436
Workers' profit participation fund	-	(133,730)
Workers' welfare fund	-	(50,818)
	(3,761,425)	2,491,888
Share of loss of equity-accounted investee	(2,591)	(1,839.00)
Profit before taxation	(3,764,016)	2,490,049
Taxations:	1,077,466	(1,097,610)
Net Profit for the period	(2,686,550)	1,392,439
Loss/ Earning per share basic and diluted	(32.64)	16.92

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