KOHC | 2QFY24 Result Review - Surge in other income upholds earnings
Kohat Cement Company Limited (KOHC) just announced its 2QFY24 result, where the company posted earnings of PkR2.2bn (EPS: PkR11.4), remaining flat QoQ while increasing by 14%YoY. Overall, the results are in line with our expectations, as the growth in other income offset the impact of declining gross profits.
- Company’s topline witnessed a 6%QoQ/5%YoY decline to PkR10.4bn compared to PkR11.1bn in the quarter before. The said quarterly decline was primarily due to the 10% decrease in the sales volumes, dropping to 0.68mn tons from 0.76mn tons in the preceding quarter.
- Gross margins contracted to 26.2% from 29.2% in 1QFY24, mainly due to higher energy costs (coal and power).
- Other income increased by 39%YoY to PkR1.2bn, owing to growth in the company’s ST investments (PkR16.8bn in 1QFY24 books vs. PkR12.3bn at Jun’23 end).
- Furthermore, finance costs clocked in at PkR180mn vs. PkR203mn in preceding quarter, down 11%QoQ, attributed to reduced borrowing and lower effective interest rates.
- Overall, earnings for 1HFY24 accumulated to PkR22.8/sh vs. PkR19.1/sh in SPLY, an increase of 19%YoY, mainly driven by a 2.6xYoY rise in other income.
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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