Searle’s earnings collapse in 1HFY4

March 01, 2024 (MLN): The Searle Company Limited (PSX: SEARL) reported its profit and loss statement for the six months ended December 31, 2023, wherein the profit after tax shrank to Rs8.52 million [EPS: Rs0.03] compared to a profit of Rs706.15m [EPS: Rs1.6] in the same period last year (SPLY).

This represents a staggering 99% year-on-year decline in profits.

Going by the consolidated results, the company's top line rose by 19.2% YoY to Rs20.09bn as compared to Rs16.86bn in SPLY.

The cost of sales rose by 26.7% YoY but was lesser than proportionate to sales increase, which improved the gross profit by 8.8% YoY to Rs7.72bn in 1HFY24.

The gross margins, however, worsened to 38.46% as compared to 42.13% in SPLY.

During the review period, other income rose 10.8% YoY to stand at Rs139.28m in 1HFY24 as compared to Rs125.74m in SPLY.

On the expense side, the company observed a rise in distribution costs by 23.3% YoY while reducing its other operating expenses by 55.7% YoY to clock in at Rs4.41bn and Rs43.55m respectively during the review period.

The company’s finance cost inflated by 28.7% YoY and stood at Rs2.15bn as compared to Rs1.67bn in SPLY, mainly due to higher interest rates.

On the tax front, the company paid a lower tax worth Rs344.79m against the Rs451.36m paid in the corresponding period of last year, depicting a fall of 23.6% YoY.

Amount in thousand except for EPS

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