Pak Suzuki Motor earns Rs443m in Apr-Jun 2022
PHOTO: REUTERS
Pak Suzuki Motor Company, the largest player in Pakistan’s automobile industry, has posted a profit of Rs443 million in the second quarter of 2022 against a profit of Rs419 million in the same period of last year.
In the April-June quarter of 2022, financial results show that the company reported earnings per share (EPS) of Rs5.4 against EPS of Rs5.2 in the same period of last year.
“The financial result came in higher than our expectation. A major deviation came from higher-than-expected gross margins and lower taxation expense,” said AL Habib Capital Markets Ltd (AHCML) auto analyst Asad Ali.
This takes the second half of 2022 loss to just Rs17 million (LPS: Rs0.2) against profit of Rs1.197 billion (EPS: Rs14.5) in the same period of last year, he said.
The company incurred a loss of Rs460 million in the first quarter of 2022, which has been largely recovered in the second quarter due to higher car prices that supported margins and increase in unit sales by 11% year-on-year due to higher demand for economic segment cars.
Gross margins of the company clocked in at 4.4%, down 141 basis points (bps) year-on-year, in the second quarter of 2022 whereas, sequentially, margins improved 74 bps due to increase in car prices and launch of the Swift model, he added.
Auto analyst Arsalan Hanif noted, “There was no impact of recent economic conditions, however, the impact will be visible in the next quarter’s result.”
Other income rose 318% to Rs1.03 billion, from Rs247.58 million, in the second quarter of 2022 due to a stronger order book and higher interest rates.
Finance cost multiplied by 18 times year-on-year to clock in at Rs811 million due to increase in mark-up cost on late deliveries and exchange loss, said Asad Ali.
The effective tax rate came in at 68% in the second quarter of 2022 as compared to 29% in the second quarter of 2021 due to the implication of super tax.
Published in The Express Tribune, August 26th, 2022.
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