Chairman says company aspires to firmly stepping up to growth path
M Jahangir Hayat
LAHORE: Atlas Honda has posted profit after tax of Rs 842.1 million in the quarter ended on June 2019,showing a decrease of 30percent, translating into the earnings per share (EPS) of Rs 6.79 against Rs 9.63 for the corresponding period of last year, quarterly report of the company indicated.
During the quarter ended June 30, 2019, the company posted net sales of Rs. 22.8 billion as compared to Rs. 22.1 billion in the same period of last year, up by 3.2%, the report exhibited.
However, gross profit for the quarter declined from Rs. 2.1 billion to Rs. 1.7 billion, down by 19%. This was due to continued devaluation of Pak rupee against USD and Japanese Yen which resulted in substantially higher input costs, it said.
Sales and marketing expenses rose to Rs. 524.1 million, an increase of 9%, which is attributable to higher volumes and promotional activities. Administrative expenses remained stagnant due to measures introduced for maximization of cost efficiencies, the report added.
Other income, net of other operating expense and financial charges, Sales Growth 9.6% 7.5% June 2018 June 2019 Sales Gross Profit (%) (Rs in million) 22,129 22,832 +3.2% Atlas Honda Limited 05 contributed Rs. 169.7 million to the bottom line, 10.6% higher than the comparative period, the report explained.
Resultantly, the company achieved profit after tax of Rs. 842.1 million, representing a decrease of 30%. This translated into Earnings per Share (EPS) of Rs. 6.79 against Rs. 9.63 (restated) for the corresponding period of last year, the report highlighted.
The company’s chairman is of the view that gradual recovery in economic activity is expected on the back of improved market sentiment in the context of the IMF support program, a rebound in the agriculture sector and export oriented industries.
However, there is a need for resolution of key structural issues to tread on the path of long term sustainable economic growth. Equally important, efforts must be intensified to capitalize on the good work done under first phase of CPEC, which has already started to improve the physical infrastructure of the country, he said.
It is critical to support industries that leverage this infrastructure and develop export capability. Through FY 20 budget, the government has taken a right step by focusing to credibly improve fiscal sustainability through revenue measures to widen the tax base by bringing undocumented economy on paper, he said.
This may hurt economic activity in the short run but is expected to bring gains in the long run. Once the economy regains its growth momentum, it would boost demand for two wheelers as well. With its installed capacity and improved competitiveness, the Company has laid the foundation for long term sustainable leadership, the chairman added.
While the macro scenario paints a picture of cautious optimism, the Company aspires to firmly stride on its growth path and consistently create value for all its stakeholders, he concluded.