DG Khan Cement (DGKC): 4QFY20 LPS at Rs0.7 (loss lower-than-expectations)
- DG Khan Cement Limited (DGKC) has reported a loss of Rs0.7/share in 4QFY20 compared to a loss of Rs2.3/share in 4QFY19.
- Loss was lower than our expectation of Rs1.2/share for the quarter mainly on account of deviation in Finance cost.
- Net sales during 4QFY20 clocked in at Rs7.5bn (in line with our expectations), down 26% YoY due to decline in volumetric sales by 27% YoY. Local and Export dispatches fell by 23% YoY and 37% YoY, respectively.
- Gross Margins clocked in at 7% during 4QFY20, broadly in line with our expectations. Margins improved by 6ppts QoQ due to decline in fuel/energy costs amidst usage of Furnace Oil.
- Finance costs declined by 17% QoQ possibly due to early repricing of loans after the recent decline in Policy Rate.
- Admin expenses were contained at Rs141mn on YoY, however, they declined by 12% QoQ.
During FY20, company posted a loss of Rs2.2bn (LPS: Rs4.9) against profit of Rs1.6bn (EPS: 3.7) due to increase in finance cost by 41% YoY and deterioration in Gross Margins by 9ppts YoY to 4%.
Co. is engaged in the production and sale of Ordinary Portland and Sulphate Resistant Cements.
Topline Securities is one of the fastest-growing brokerage houses in Pakistan. It has strong Equity Brokerage, Economic/ Equity Research, Commodity Trading and Corporate Finance & Advisory functions.
Topline Securities has been endowed with numerous awards by renowned international financial organizations. The highlights of which consists of the award for ‘Best Local Brokerage House of Pakistan’ by Asiamoney Brokers Poll (the largest Asia-focused equity services provider poll) in 2016 and ‘Best Equity Brokerage House’ by CFA Society Pakistan in 2015.
Previously, Topline Securities held the title for ‘Best Brokerage House’ for 4 consecutive years (2011-2014) by Asiamoney Brokers Poll. Other awards include the ‘Best Salesperson’ award by Asiamoney for 6 consecutive years (2011-2016), the ‘Arabia Fast Growth 500’ award and ‘Pakistan Fast Growth 100’ award in 2012 and 2013 by AllWorld Network.
JCR-VIS, a credit rating agency providing independent rating services in Pakistan has assigned initial rating of “A-2” for short term and “A” for long term to Topline Securities. Topline Securities is registered as Underwriter, Book Runner and Research Entity with Securities & Exchange Commission of Pakistan (SECP).
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