Revenue slump, cost hike hit Amreli Steels hard

MG News | February 27, 2024 at 03:40 PM GMT+05:00

0:00

February 27, 2024 (MLN): Amreli Steels Ltd. (PSX: ASTL) posted a wider loss in the first half of fiscal 2024 as revenue failed to lift off while expenses surged.

The steel manufacturer incurred a loss after tax of Rs605.17 million [LPS: Rs2.14] in the six months ended December 31, 2023, compared to a loss of Rs184.74m [LPS: Rs0.62] in the same period last year (SPLY).

Going by the results, the company's top line marked a decrease of 3.39% YoY to Rs22.25bn as compared to Rs23.03bn in SPLY.

However, the cost of sales also declined 4% YoY to Rs19.8bn, boosting gross profit by 1.7% YoY to Rs2.5bn. Gross margin improved to 11.2% from 10.6%.

Other income plunged 69% YoY to Rs2.11m in 1HFY24 as compared to Rs6.9m in SPLY.

On the expense side, administrative expenses jumped 32% YoY to Rs441.5m and other expenses soared 5.76x YoY to Rs122.9m.

Finance cost increased 15.5% YoY to Rs2.26bn as interest rates rose in the period.

On the tax front, the company paid a higher tax worth Rs290.09m against the Rs232.41m paid in the corresponding period of last year, depicting an increase of 24.82% YoY.

Unconsolidated (un-audited) Financial Results for half year ended December 31, 2023 (Rupees in '000)
	Dec 23	Dec 22	% Change
Sales	22,251,024	23,030,883	-3.39%
Cost of sales	(19,767,428)	(20,588,408)	-3.99%
Gross Profit	2,483,596	2,442,475	1.68%
Administrative Expenses	(441,460)	(334,626)	31.93%
Selling And Distribution Expenses	(553,444)	(499,045)	10.90%
Other Income	2,113	6,898	-69.37%
Other Operating Expenses	(122,942)	(21,348)	475.89%
Finance Cost	(2,263,129)	(1,958,972)	15.53%
Loss before taxation	(895,266)	(417,158)	114.61%
Taxation	290,094	232,414	24.82%
Net Loss for the period	(605,172)	(184,744)	227.57%
Basic earnings/ (loss) per share	(2.14)	(0.62)	-

Amount in thousand except for EPS

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