Pak Elektron (PAEL): 2Q2020 EPS at Rs0.19 (higher than our expectations)
- Pak Electron (PAEL) announced its 2Q2020 financial result today, where the company booked a profit of Rs106mn (EPS: Rs0.19) compared to a profit of Rs94mn (EPS: Rs0.17) in 2Q2019.
- It takes 1H2020 loss to Rs426mn (LPS: Rs0.9) compared to a profit of Rs276mn (EPS: Rs0.51) in 1H2019.
- The earnings came in higher-than-expectations due to lower-than-expected distribution and finance costs.
- While Net Sales declined by 4% YoY during 2Q2029, they improved by 25% QoQ due to increase in volumetric sales from the Power Division segment and seasonal uptick.
- Gross Margin clocked in at 21.9% in 2Q2020, which is in line with our expectations.
- Admin costs increased by 119% YoY to Rs385mn, while Finance costs escalated by 56% YoY to Rs529mn (but were down by 31% QoQ).
- Company booked a tax expense of Rs24mn in 2Q2020 compared to tax reversal of Rs11mn in same period last year.
Pak Elektron Limited. Pak Elektron Limited is engaged in manufacturing and sale of electrical capital goods and domestic appliances. The Company operates through two segments: Power Division and Appliances Division. The Power Division is engaged in manufacturing and distribution of transformers, switchgears, energy meters, power transformers, construction of grid stations and electrification works. The Appliances Division is engaged in manufacturing, assembling and distribution of refrigerators, deep freezers, air conditioners, microwave ovens, washing machines and other home appliances. It offers services to power utilities, industries, individual customers, housing and commercial projects. Its engineering, procurement and construction (EPC) contracting division delivers custom designed and built high voltage and extra high voltage grid stations, electrification of housing projects and industrial parks. The Company's subsidiary is PEL Marketing (Private) Limited.
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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