Engineering: CRESCENT STEEL & ALLIED PRODUCTS LIMITED - Half Year Ended December 31 2006
The company was incorporated on August 1, 1983 and is quoted on all stock exchanges of Pakistan. It is operating with two diverse business segments ie steel products and textile yarn and its manufacturing facilities are located in two provinces ie Sindh and Punjab and its registered office is located at Lahore.
The steel division of the company comprises manufacturing and coating of steel pipes whereas the cotton division is involved in yarn manufacturing activity.
At present (15.06.2007), the share in the company is trading at Rs 67.15 per share which is 6.7 times of the par value. During the last one year the market price of the share trended upward from Rs 32.35 per share and reached its highest price of Rs 72.50 per share.
The company has also large portfolio of investments in marketable securities as on December 31, 2006, its long term investment amounted to Rs 1.011 billion and short term investments amounted to Rs 974.41 million. In this connection, the company generated dividend income at Rs 32.63 million and gain on sale of investments and rights.
The company's net sales amounted to Rs 1,368.16 million in HYD 06-07 showing remarkable growth of 167.5% as against Rs 511.54 million in the corresponding period last year. In this performance the sales revenue of steel division comprised 50.8% and of cotton division at 49.2%. During the period under review HYD 06-07, the contribution of steel division was higher as in HYD 05-06, the steel division's contribution to sales revenue was less at 39% and of cotton division at 61%.
The company earned profit before taxation at Rs 255.59 million in HYD 06-07 as compared to Rs 199.26 million in the same period last year (SPLY). In this profit the contribution of steel division was Rs 254.2 million or 99.4% and of cotton division at 0.6%.
In the half year under review the cotton division earned pretax profit of Rs 1.43 million whereas it had booked loss of Rs 15.11 million in the SPLY.
The plus points of cotton division had been increasing revenue and improved gross margin, increased sales revenue was due to full production of the second spinning mill (Unit II) and increased gross margin was mainly due to better yarn prices particularly in higher counts. However the cotton division continues to face challenges of increased finance cost due to long term loan used for financing Unit II and utilization of short term finance to support increased operational activity. In addition regular upward trend of interest rates.
The company recorded modest rise in the after tax profit as in HYD 06-07 it was Rs 212.44 million (SPLY: Rs 204.87 million).
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Performance Statistics (Min Rs)
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Balance Sheet ---As At--- December 31 June 30
2006 2006
Un-audited Audited
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Share Capital Paid-up: 466.61 349.96
Reserves & Surplus: 2,207.36 1,687.74
Shareholders Equity: 2,673.97 2,037.70
L.T. Debts: 450.52 548.31
Deferred Taxation: 44.08 1.64
Current Liabilities: 1,229.37 1,127.10
Fixed Assets Tangible: 1,326.27 1,339.59
Intangible Assets: 0.89 1.11
L.T. Investments: 1,011.36 485.19
L.T. Deposits & Prepayments: 4.80 5.75
Current Assets: 2,054.62 1,883.11
Total Assets: 4,397.94 3,714.75
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Profit & Loss A/c for Half Year Ended
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---December 31--- 2006 2005
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Sales-Net: 1,368.16 511.54
Gross Profit: 208.52 41.37
Other Operating Income: 241.48 241.09
Operating Profit: 346.85 217.93
Finance (Cost): (65.07) (18.31)
Share of Loss in Associates: (26.19) 0.36
Profit Before Taxation: 255.59 199.26
Profit After Taxation: 212.44 204.87
Earnings Per Share (Rs): 4.81 5.81
Share Price (Rs) on 19/06/2007: 67.15 -
Price/Earning Ratio: 13.96 -
Debt/Equity Ratio: 14:86 21:79
Current Ratio: 1.67 1.67
Gross Profit Margin (%): 15.24 8.09
Net Profit Margin (%): 15.52 40.04
R.O.A. (%): 4.83 5.51
R.O.E. (%): 7.94 10.07
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COMPANY INFORMATION: Chairman: Mazhar Karim; Chief Executive: Ahsan M. Saleem; Company Secretary: Mohammad Amin; Registered Office: Crescent Standard Tower, Gulberg III Lahore; Principal Office: Sidco Avenue Centre, Karachi 74200; Website URL: www.crescent.com.pk; Factories: Steel Division: Site Nooriabad District Jamshoro Sindh Province; Cotton Division: Spinning Unit, Lahore Road, Jaranwala District Faisalabad, Punjab Province.
CORRIGENDUM: In our Tuesday issue there was some serious omission in company information about First Habib Bank Modaraba. The correct position is as under: Chairman R. Zakir Mahmood, Chief Executive Saeed Uddin, Directors: Sohail Malik, Sima Kamil, Company Secretary: Muhammad Amin Chotani, Chief Financial Officer: Atif Aziz.
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