Lucky Cement’s earnings drop 24% as sales volume dips

Company makes profit of Rs3.16b in Jul-Sept 2018 quarter

KARACHI: Lucky Cement reported a profit of Rs3.16 billion for the first quarter ended September 30, 2018, down 24% compared with Rs4.17 billion for the corresponding period of previous financial year.

The profit for the quarter translated into earnings per share (EPS) of Rs9.14 as compared to Rs11.9 in the same period last year.

On a consolidated basis, the company’s gross turnover stood at Rs31.32 billion, which was 9.2% higher than the same period of last year when it stood at Rs28.68 billion.

Looking at the company’s standalone performance, the gross sales revenue edged up 2% to Rs16.01 billion compared to Rs15.7 billion in the same period last year.

The increase in revenue came mainly on the back of higher volumes and rise in federal excise duty and sales tax.

Furthermore, on a standalone basis, Lucky Cement recorded a net profit of Rs2.49 billion, which was 17.4% lower than the same period last year. Similarly, the standalone EPS was Rs7.71, which was 17.4% lower as compared to the EPS of Rs9.33 in the same period last year.

Local cement sales’ volume showed a decline of 5.9% - 9.1% in the northern region and 2.2% in the south - in the first quarter and reached 1.40 million tons as compared to 1.48 million tons in the same period last year.

Owing to no clinker sales in the quarter under review, overall local sales volume declined 9.1% at 1.40 million tons as compared to 1.54 million tons in the same period last year.



On the other hand, export sales volume increased 85% to 0.50 million tons during the Jul-Sept 2018 quarter compared to 0.27 million tons in the corresponding period of previous year.

Lucky Cement also shared progress on its brownfield expansion programme for the production of 2.6 million tons of cement per annum at its Pezu Plant and the greenfield investment project for the production of 1.2 million tons of clinker at Samawah, Iraq.

In addition to these, the company also reported progress on its 1X 660-megawatt supercritical coal-based power project at Port Qasim and automobile manufacturing plant under licence from Kia Motors Corporation.



The company said it remained positive about the outlook of the cement industry on the back of new government initiatives to build both small and mega-capacity dams and five million housing units, which could lead to improvement in domestic sales.

Regarding exports, the company said sales were expected to remain strong in view of favourable market dynamics and growing demand for clinker in regional markets.

Published in The Express Tribune, October 30^th, 2018.

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