August 03, 2023 (MLN): Sugar Sector in Pakistan recorded the highest-ever profits in 9MFY23, with a rise of 22.61% YoY, clocking in the total sector's profit after tax at Rs13.7bn as compared to Rs11.18bn in the same period last year (SPLY).
Going by the companies' results, the sector recorded the highest ever sales in a nine-month period, increasing by 24.62% YoY to Rs235.28bn as compared to Rs188.79bn in SPLY.
This increase is due to a rise in both Sugar volumes and prices.
Ethanol, which is a by-product of sugar, experienced improved performance in 9MFY23 due to favorable Ethanol selling prices in the international market along with the devaluation of the Rupee against the US dollar.
The sector saw an increase in exports, with total exports totaling 216k tons and a 13% YoY increase in average domestic prices.
The cost of sales rose by 23.88% YoY, which was lesser than proportionate to sales increase, which improved the gross profit of the sector by 28.54% YoY to Rs38.51bn in 9MFY23.
The slight improvement in gross profits can be attributed to improved retention prices.
Similarly, during the review period, the sector enjoyed a significantly larger other income, which was 5.91x higher than SPLY to stand at Rs1.49bn in 9MFY23.
On the expense side, the sector observed a rise in selling and distribution expenses by 46.18% YoY to clock in at Rs7.57bn during the review period, which is in line with the increase in volumetric sales along with the inflationary environment.
The sector incurred finance costs worth Rs16.55bn as compared to Rs9.08bn in 9MFY23, depicting an increase of 82.28% YoY, mainly due to higher interest rates.
On the tax front, the sector accounted for a total of Rs3.26bn tax as against the Rs3.82bn paid in the corresponding period of last year, depicting a decrease of 14.58% YoY.
| Unconsolidated (un-audited) Financial Results for nine months ended 30 June, 2023 (Rupees in '000) | |||
|---|---|---|---|
| June 23 | June 22 | % Change | |
| Sales | 235,276,000 | 188,793,000 | 24.62% |
| Cost of sales | (196,771,000) | (158,838,000) | 23.88% |
| Gross Profit | 38,505,000 | 29,955,000 | 28.54% |
| Selling and Distribution Expenses | (2,906,000) | (1,988,000) | 46.18% |
| Administrative expenses | (7,574,000) | (6,183,000) | 22.50% |
| Other operating income | 1,007,000 | 741,000 | 35.90% |
| Other Income | 1,489,000 | 252,000 | 490.87% |
| Finance cost | (16,546,000) | (9,077,000) | 82.28% |
| Profit/(Loss) from Associate | 2,990,000 | 1,295,000 | 130.89% |
| Profit before taxation | 16,965,000 | 14,995,000 | 13.14% |
| Taxation | (3,262,000) | (3,819,000) | -14.58% |
| Net profit for the period | 13,703,000 | 11,176,000 | 22.61% |
Company-wise, Al-Abbas Sugar Mills Limited (PSX: AABS) remained the best performer with profits of Rs2.61bn, followed by Shahmurad Sugar Mills Limited (PSX: SHSML) with a profit of Rs2.4bn and The Thal Industries Corporation Limited (PSX: TICL ) with a profit of Rs1.55bn in 9MFY23.
To note, AABS, SHSML, and TICL accounted for 19%, 18%, and 11% of the total sector profit respectively.
| Company-wise sugar sector (Rupees in '000) | ||
|---|---|---|
| Company | Profit 9MFY23 | % of total sector |
| AL-Abbas | 2,608,000 | 19.03% |
| Shahmurad | 2,419,000 | 17.65% |
| Thal | 1,553,000 | 11.33% |
| JDW | 1,478,000 | 10.79% |
| Habib | 1,369,000 | 9.99% |
| Tandlianwala | 1,253,000 | 9.14% |
| Mehran | 1,046,000 | 7.63% |
| Faran | 696,000 | 5.08% |
| Mirpurkhas | 625,000 | 4.56% |
| Chashma | 257,000 | 1.88% |
| Others | 399,000 | 2.91% |
| Total | 13,703,000 | 100.00% |
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Posted on: 2023-08-03T15:33:14+05:00
