Searle’s profitability declines by 18.5% owing to a rise in finance cost

MG News | October 29, 2019 at 11:14 AM GMT+05:00

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October 29, 2019 (MLN): The Searle Company Limited has announced its financial results for the quarter ended on September 30, 2019. As per the results, it has posted its net earnings of Rs. 554 million, around 18.53 % lower than the same period of last year owing to a rise in finance cost.

During the period, the sales revenue were up by 13.28%. However, a greater percentage increase in the cost of sales caused gross profits to increase by around 11.74% to Rs 2.3 billion.

The gross margin shrunk marginally by 0.66 per cent points owing to seasonality.

The overall expenses of the company increased: distribution costs by 19% YoY, operating costs by 17.99% YoY and finance cost by 43.8%YoY.

On the other hand, the other income rose by 25.74% to Rs 49 million. The tax expenses increased substantially by 2 times compared to the same period of last year.

Moreover, Searle’s basic and diluted earnings per share have been reported at Rs 2.57 per share while those recorded last year were Rs 3.18 per share.

Consolidated Statement of Profit or Loss for the quarter ended September 30th 2019 ('000 Rupees)
	Sep-19	Sep-18	% Change
Revenue	4,962,130	4,380,366	13.28%
Cost of sales	(2,589,484)	(2,257,030)	14.73%
Gross profit	2,372,646	2,123,336	11.74%
Distribution costs	(1,096,777)	(921,718)	18.99%
Administrative expenses	(304,220)	(280,478)	8.46%
Other operating expenses	(58,800)	(49,833)	17.99%
Other income	49,400	39,287	25.74%
Profit for operations	962,249	910,594	5.67%
Finance cost	(143,040)	(99,442)	43.84%
Profit before income tax	819,209	811,152	0.99%
Income tax expense	(264,593)	(130,378)	102.94%
Profit for the period	554,616	680,774	-18.53%
Basic and diluted earnings per share (Rupees)	2.57	3.18	-19.18%