DGKC_1QFY24 Result Review,(AKD Off the Analyst's Desk Oct 30, 2023)
D.G. Khan Cement Company Ltd. (DGKC) announced its 1QFY24 result today, wherein the company posted earnings of PkR661mn vs. a loss of PkR5,748mn in the preceding quarter. Where the loss in the previous quarter was primarily due to contracted gross margins, heightened financial charges, and the impact of retrospective super tax implementation.
- Topline of the company witnessed a decline of 2.5%QoQ, clocking in at PkR16.5bn vs. PkR16.9bn in the quarter before. The said drop in the topline is majorly due to a 12%QoQ decrease in sales volumes, offsetting the impact of increased retention prices.
- Gross margins of the company improved significantly to 19.5% vs. 10.7%/15.3% in 4QFY23/SPLY, respectively, primarily due to a decline in coal prices. To note, ~35% of the company’s power mix is contributed by CFP (coal-fired power plants).
- Operating expenses declined by 21%QoQ, mainly due to a drop in distribution costs amidst an expected decrease in freight and handling charges over low exports compared to the previous quarter.
- Furthermore, other income declined by 25%QoQ, arriving at PkR827mn, falling short of our expectations.
- Additionally, finance cost reached PkR2.1bn vs. PkR1.9bn in the previous quarter. This increase can possibly be due to an increase in short-term borrowings during the quarter.
AKD Securities Ltd. is one of the leading securities firm in Pakistan, providing a comprehensive range of investor focused services, including equity brokerage, economic and securities research, investment banking and financial advisory services. AKD Securities accounts for more than 6% of the average daily value of the Karachi Stock Exchange. AKD Securities was the first brokerage house to launch an online trading platform in Pakistan in November 2002 and now has the largest market share with over 6000 customers. This has helped diversify and expand the retail investor base in the country and ushered in a whole new universe of investors to the stock market.
AKD Securities Ltd. caters to a diversified group of domestic and international institutional investors, high net worth individuals and upscale retail clients, including expatriate Pakistanis. With high quality research, unparalleled execution and distribution capability for both regular and large block trades, AKD Securities Ltd. has earned an outstanding reputation in the Pakistani securities industry.Outside of commercial banks, AKD Securities Ltd. is one of the biggest capital market firms in the country. AKD Securities is the leader in raising and providing risk capital in underwriting, market making and mergers and acquisitions in Pakistan. Good corporate governance and professionalism are emphasized throughout the firm and AKD Securities Ltd. is amongst the very few companies to have introduced a firm-wide comprehensive CODE of ETHICS, overseen by an independent compliance manager.Ultimately, our success is based on the quality of service we provide to our customers and the trust and confidence reposed in us by them. Our focus, therefore, remains on customer satisfaction at all levels in the company.
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