Nishat Mills Limited, which is one of the biggest names in the Pakistani textile industry, announced its financial results for the year ended June 30, 2019.
The flagship company of Pakistan's largest business house, Nishat Group, announced a consolidated profit of Rs. 9.65 billion up by 9.20% compared with Rs. 8.84 billion in the same period of last year.
There was a 13.32% increase in sales of the company, which were posted at Rs. 96 billion as compared to last year's Rs. 84.72 billion. This was likely due to the Rupee's depreciation against the US dollar with an increase in prices of value-added products and improving export demands. One of the primary reasons for the increase in profitability was the increase in revenues due to favorable rate variances in both, export and local sales.
However, the company's cost of sales was posted at Rs. 79.10 billion as compared with Rs. 71.14 billion which resulted in an increase in gross profits to Rs. 16.90 billion against Rs. 13.57 billion.
The other income saw an increase of 60.65% to Rs. 3.4 billion as compared with Rs. 2.13 billion recorded in the same period last year. The increase was on the account of exchange gains and other dividend incomes.
The finance cost increased to Rs. 2.66 billion, up by 50% as compared to Rs. 1.77 in the same period last year. The increase was due to an increase in average borrowing costs. During the fiscal year, the short term loans also increased, which were obtained to finance procurement of cotton in bulk and disbursement of working capital loans to subsidiary companies.
Earnings per share of the company were increased to Rs. 22.20 from Rs. 20.72 recorded last year. The company also announced a final cash dividend of Rs. 4 per share i.e. 40%.
NML's shares at the bourse were closed at Rs. 83.46, up by Rs. 2.79 with a turnover of 1,930,400 shares on Thursday.
The company also notified that it had raised its investment in Hyundai Nishat Motors to Rs 1.26 billion from Rs 960 million, and approved a loan of Rs. 1 billion to Nishat Hotels at one-month Kibor plus 100 bps for a period of one year. It also notified that the company is investing up to Rs. 950 million in Nishat Sutas Dairy Limited, an associated company for subscribing up to 95 million ordinary shares of Rs. 10 each.
Nishat is establishing a new project of towel manufacturing of approximately Rs. 1.5 billion, and has a capacity of 10 tons per day.
Source: Pro Pakistani