April 27, 2020 (PPI-OT)

Amreli Steels Limited - High end operating expenses and finance costs push results yet again. 3QFY20 LPS clocks in at PKR (1.26); 9MFY20 LPS accumulates to (PKR 2.32)

Amreli Steels Limited (ASTL) announced its financial results for 3QFY20 with a net loss of PKR 375mn (LPS: PKR 1.26), down by 28%YoY, as compared to a net loss of PKR 293mn (LPS: PKR 0.99) reported in the same period last year. This accumulates 9MFY20 consolidated net loss to PKR 688mn (LPS: PKR 2.32) as against a profit of PKR 224mn (EPS: PKR 0.75) reported in the comparative period.

Net sales of the Company during 3QFY20 grew by +21%YoY as against the comparative period largely on the back of enhanced dispatches made during the quarter.

Gross profit margins of the Company have improved to 6% in 3QFY20 as against 5% reported in the comparative quarter of the preceding year. The improvement is ascribed to lower production costs driven largely from benign scrap prices globally as against the comparative period.

Selling and distribution costs of the Company have increased by +39%YoY, possibly incurred on account of marketing expense in line with the prevalent marketing strategy pursued by the Company lately.

Other expenses of the Company have surged substantially by 5.4x during the quarter. We await publication of interim report for an accurate analysis.

Finance charges of the Company during 3QFY20 have jacked up by +57%YoY, largely driven by substantial increase in short term borrowing requirements of the Company and higher benchmark interest rates prevalent in 3QFY20 as against the comparative quarter.

© Pakistan Press International, source Asianet-Pakistan