PAEL’s profit soars 27%, amounts to Rs3.66b

Earnings per share rise to Rs7.51 in year under review from Rs6.61 last year

KARACHI: Pak Elektron Limited’s consolidated net profit increased 27% to Rs3.66 billion in the year ended December 31, 2016 mainly on the back of higher sales, according to a bourse filing on Wednesday.

The company had booked the profit at Rs2.88 billion in the preceding year.

Earnings per share rose to Rs7.51 in the under review year from Rs6.61 last year.

The board of directors has recommended a final cash dividend at R1.75 per share. This will be paid to the shareholders whose names will appear in the register of members on April 17, 2017. The entitlement is in addition to interim dividend already paid at Rs1.25 per share.

Share price of the firm dropped 1.52% or Rs1.33 and closed at Rs85 with a volume of 3.16 million shares at the Pakistan Stock Exchange.

Topline Securities analyst Salman Rashid said, in a post-result comment, the net profit increased “mainly due to volumetric growth, lower input costs in the latter half of 2016 and decline in taxation expense by 29% on year-on-year basis”.

The revenue (sales) increased 16% to Rs34.12 billion in 2016 from Rs29.32 billion in 2015.

In the quarter ended December 31, 2016, alone, he said, it booked consolidated earnings at Rs1.3 per share.

The earnings were supported significantly by lower input cost (steel, aluminium & copper) during the period. “The result announced was above our expectations.”

Gross revenues of PAEL were down 5% year-on-year during 4Q2016 owing to product mix alignment and price rationalisation. While cost of sales posted a major decline of 42% YoY due to lower commodity prices in global market, we believe. Thus, gross margins increased significantly by 13 points to 34% in 4Q2016.

Published in The Express Tribune, March 16^th, 2017.

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