Surging coal prices and PKR devaluation drag Lucky Cement’s profits down by 24%

MG News | April 26, 2019 at 05:10 PM GMT+05:00

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April 26, 2019 (MLN): Lucky Cement Limited has achieved Profits after Tax of Rs. 9.9 billion (EPS: Rs. 28.64) during the nine months period ended March 31, 2019, as compared to Rs. 13 billion reported during the same period last year.

The company’s sales revenue grew by 11.5% due improvement in retention prices as well as higher export volumes for clinker. The overall volumetric sales grew by 1.9% to reach 5.95 million tons during the period under review. The local cement sales volume registered a decline of 12.2% and was 4.42 million tons in comparison to 5.04 million tons last year.

However, the cost of sales surged by 21% on the back of increase in coal prices, packing material and other fuel prices. Furthermore, PKR devaluation also contributed in dragging up the cost of sales.

The distribution expenses of the company jumped by 28%, owing to increase in exports by 105.5% to 1.53 million tons. Moreover, the finance costs escalated by 115% on account of increase in interest rates.

However, the company gained some relief in the form of deferred taxation, which reduced the tax expenses by Rs. 1 billion.

Profit and loss account for the nine months ended March 31 2019 (Rupees'000)
	Mar-19	Mar-18	% Change
Revenue	103,320,389	92,601,630	11.58%
Sales tax and excise duty	-16,764,874	-16,469,999	1.79%
Rebates and commission	-4,489,902	-3,784,476	18.64%
Cost of sales	-63,799,985	-52,539,849	21.43%
Gross profit	18,265,628	19,807,306	-7.78%
Distribution cost	-4,296,137	-3,333,525	28.88%
Administrative expenses	-2,308,421	-2,070,348	11.50%
Finance cost	-1,151,277	-534,989	115.20%
Other expenses	-1,313,476	-1,760,266	-25.38%
Other income	3,061,838	3,502,495	-12.58%
Profit before taxation	12,258,155	15,610,673	-21.48%
Taxation
- current	-3,332,147	-2,423,620	37.49%
- deferred	1,071,569	-119,736
Profit after taxation	9,997,577	13,067,317	-23.49%
Earnings per share - basic and diluted	28.64	36.91	-22.41%

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