Corporate results: Maple Leaf Cement posts Rs3.5 billion profit

Beats market consensus, earnings for FY15 higher by 22%.

KARACHI: Higher volumetric sales and lower coal prices helped Maple Leaf Cement beat market expectations as the company boosted its profits by more than one-fifth to Rs3.5 billion during the financial year that ended on June 30, 2015.

According to an official notification sent to the Karachi Stock Exchange on Wednesday, the company posted an after-tax profit of Rs3.5 billion or Rs6.5 per share in fiscal year (FY) 2015. This translates to a 22% increase when compared with Rs2.8 billion or Rs5.4 per share it earned in FY 2014.

The company also announced a final Rs1 cash dividend, taking the total payout for the year under review to Rs2 per share.

The result was above market expectations as a Taurus Securities report predicted net earnings of Rs6.2 per share, which translates to a 16% year-on-year growth.

However, the stock, which traded at Rs68.69 per share the previous day, declined by 0.8% or Rs0.6 per share to settle at Rs68.14 per share on profit booking by investors. A total of 5.5 million shares changed hands on Wednesday, less than half when compared to Tuesday’s 13 million.

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The growth in earnings was a factor of volumetric growth due to higher dispatches and expansion in margins, which increased by 180 basis points, BMA Capital said in a report. Monetary easing and deleveraging helped ease its finance cost, which clocked in at Rs1 billion, down 26% from Rs1.5 billion of the previous year, leaving positive impact on net earnings, it added.

A subsidiary of Kohinoor Maple Leaf Group, Maple Leaf Cement grossed Rs20.7 billion in revenues during the year under review, up 9.2% compared to Rs18.9 billion of FY2014. Kohinoor Maple Leaf Group is a division of Saigol Group of Companies.

Along with the results, the company also announced its plan to invest Rs5 billion in Maple Leaf Power Limited for setting up a 40 Megawatt coal-fired power plant.

Published in The Express Tribune, September 10^th,  2015.

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