THALL's profitability declines by 33% due to lower revenues

MG News | October 25, 2019 at 02:25 PM GMT+05:00

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October 25, 2019 (MLN): Thal Limited, has declared consolidated profits of Rs. 650.3 million for the quarter September 30^th, 2019 approximately 33% lower than the parallel period last year. The company recorded its EPS at Rs. 7.04 per share for the same period.

The drop in financial earnings came largely due to a decline in net revenues by 18.6%, which led the gross margins to decline considerably from 18% to 8%.

The decline in profitability was also attributable to a surge in the company’s core expenses and finance cost. Core expenses such as distribution cost and admin cost jumped by 11.5% and 2% respectively, whereas, finance cost increased significantly by 1053%.

Despite experiencing improvement in the company’s other income and reduction in tax expenses by 28.4% and 33.6% respectively, the impact failed to lift Thal’s profitability.

Profit and Loss Account for the quarter ended September 30, 2019 ('000 Rupees)
	Sep-19	Sep-18	% Change
Revenue - net	4,186,504	5,148,188	-18.68%
Cost of sales	(3,834,221)	(4,220,606)	-9.15%
Gross profit	352,283	927,582	-62.02%
Distribution costs	(91,979)	(82,445)	11.56%
Administrative expenses	(380,834)	(372,699)	2.18%
Other charges	(20,092)	(52,133)	-61.46%
	(492,905)	(507,277)	-2.83%
Other income	771,422	600,683	28.42%
Operating profit	630,800	1,020,988	-38.22%
Finance costs	(39,873)	(3,457)	1053.40%
	590,927	1,017,531
Share of net profit of associates - after tax	272,590	271,922	0.25%
Profit before taxation	863,517	1,289,453	-33.03%
Taxation	(213,157)	(309,660)	-31.16%
Profit after taxation	650,360	979,793	-33.62%
Basic and diluted earnings per share (Rupees)	7.04	10.80	-34.81%

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