February 24, 2022 (MLN): Treet Corporation Limited (PSX: TREET) has posted a net profit of Rs341 million (EPS: Rs1.95) during 1HFY22, a turnaround from the same period last year when it incurred a net loss of Rs353mn (LPS: Rs1.98).
During the period under review, the company witnessed a growth of 8% YoY in topline as it went up to Rs7.75 billion. Meanwhile, the increase in the cost of sales was meagre therefore the gross margins expanded from 17.74% to 19.38%.
On the cost front, the administrative and distribution expenses dropped by 25.3% and 12.3% YoY to stand at Rs478mn and Rs290mn, respectively.
In addition, the finance cost of the company declined by 14.8% YoY to Rs457mn which also helped in strengthening the bottom line. However, the company booked a tax expense of Rs168mn during 1HFY22.
Treet has deleveraged itself by selling Global Art Limited and paying 30% of its debt to the bank, ahead of rising interest rates. The company is looking for debt re-profiling by converting ST borrowings (6bn) to LT debt out of which 50% (3bn) is already completed.
The company is planning for capital restructuring of FTMM to make equity positive and spin-off battery segment from FTMM into a separate company (IPO expected in next financial year). New Battery Company will be formed under a demerger scheme subject to approval from the high court in the next two months. NOC is already granted for the new company by SECP, a report by Foundation Securities noted.
|
Consolidated Financial Results for the half-year ended December 31, 2021 ('000 Rupees) |
|||
|---|---|---|---|
|
Dec-21 |
Dec-20 |
Change |
|
|
Revenue -Net |
7,757,238 |
7,179,158 |
8.052 |
|
Cost of revenue |
(6,253,718) |
(5,904,911) |
5.907 |
|
Gross Profit (Loss) |
1,503,520 |
1,274,247 |
17.993 |
|
Administrative expenses |
(289,988) |
(330,933) |
-12.373 |
|
Distribution cost |
(478,626) |
(640,817) |
-25.310 |
|
(768,614) |
(971,750) |
-20.904 |
|
|
Operating Profit / (Loss) |
734,906 |
302,497 |
142.947 |
|
Other income |
250,684 |
87,478 |
186.568 |
|
985,590 |
389,975 |
152.732 |
|
|
Financial expenses |
(457,681) |
(537,700) |
-14.882 |
|
Share of profit / (loss) of associate |
19,129 |
8,951 |
113.708 |
|
547,038 |
(138,774) |
– |
|
|
Workers' Profit Participation Fund |
(27,355) |
(31,348) |
-12.738 |
|
Workers' Welfare Fund |
(10,383) |
(3,617) |
187.061 |
|
Profit (Loss) before taxation |
|
||
|
Taxation |
|
||
|
Group |
(156,490) |
(129,632) |
20.719 |
|
Associated company |
(11,651) |
(6,278) |
85.585 |
|
Profit / (Loss) from continuing operation |
341,159 |
(309,649) |
– |
|
Profit (Loss) from discontinued operation |
(43,770) |
– |
|
|
Profit (Loss) after taxation |
341,159 |
(353,419) |
– |
|
Earnings / (Loss) per share – (Rupees) |
1.95 |
(1.98) |
– |
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