Sazgar records massive jump in earnings, reports profit of Rs1.4bn in 1HFY24

January 31, 2024 (MLN): Sazgar Engineering Works Limited (PSX: SAZEW) unveiled its profit and loss statement for 1HFY24, wherein the profit after tax clocked in at Rs1.41 billion [EPS: Rs23.4] compared to a profit of Rs79.11m [EPS: Rs1.31] in the same period last year (SPLY).

Going by the results, the company's turnover surged by 3.04 YoY to Rs14.53bn as compared to Rs4.78bn in SPLY.

Likewise, the cost of sales grew by 2.67x YoY. However, the growth in sales outpaced the rise in costs, leading to a significant improvement in gross profit by 517.14% YoY, reaching Rs3.12bn in 1HFY24.

On the expense side, the company observed an increase in Distribution and marketing expenses and other expenses to clock in at Rs556.03m and Rs173.49m respectively during the review period.

Similarly, the burden of administrative expenses increased by 60.16% YoY to Rs158.02, in 1HFY24.

However, SAZEW's earnings during this period were significantly supported by its other income which stood at Rs186.46m in 1HFY24 as compared to just Rs3.77m in SPLY, reflecting a massive growth.

Additional benefits were realized through eased financing, as the company's finance costs contracted by 21.38% YoY, amounting to Rs71.35m compared to Rs90.76m in 1HFY23.

On the tax front, the company paid a substantially higher tax worth Rs931.41m against the Rs19.51m paid in the corresponding period of last year.

In addition to the financial results, the Board of Directors of the company in their meeting held today has approved the purchase of a piece of land measuring nearly 20 kanals, valued at approximately Rs165 million (subject to actual land measurement).

The land is situated adjacent to the four-wheeler project.

The Chief Executive of the company has been authorized to negotiate and finalize the terms and conditions and to fulfill all the legal formalities to complete the said purchase of land.

Amount in thousands except for EPS

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