Pakistan Tobacco records 202% higher profits over last year

Higher turnover and lower expenses lead to stellar earnings for company.

KARACHI:

The Pakistan Tobacco Company has announced its results for the quarter ended March 31, 2013, recording stellar earnings of Rs1.09 billion as compared to only Rs359 million earned in the same period of the preceding year (translating into 202% growth). The company has also announced an interim dividend of Rs2 per share alongside the results.

The company’s net sales for the period improved nearly 28% over the same period of the previous year, and it recorded a 45% higher gross profit at Rs2.72 billion. Meanwhile, its selling and distribution expenses dropped 33% over the previous year to Rs597.49 million, while administrative expenses remained more or less flattish at Rs331.72 million. At the same time, its operating expenses grew 17% to Rs136.53 million, while operating income also registered a rise of 144% to Rs20.99 million. All these factors meant the company retained more of its gross profits than the previous year, as its net finance costs also registered a drop of an impressive 96% to Rs1.66 million.

The company paid a total of Rs15.26 billion in excise, sales and income taxes for the period.

According to recent reports, Pakistan Tobacco has decided to promote tobacco farming in Pakistan and take Punjab’s farmers on board in a bid to enhance its image as a promoter of localisation. The company has decided to boost tobacco production by establishing a nursery in Mianwali district where saplings have been cultivated. The tobacco giant has also established a nursery in Islamabad.

Pakistan Tobacco’s investment in Punjab alone has already touched half a billion rupees for the pilot project of in-house curing of tobacco leafs. The project is aimed at improving quality while achieving economies of scale.

Published in The Express Tribune, April 20^th, 2013.

Like Business on Facebook to stay informed and join in the conversation.