PTC gaining pace

Pakistan Tobacco Company, an associate of one of the biggest tobacco groups "British American Tobacco Company", and the first multinational company to start its operation in Pakistan announced its corporate result for 3QCY11, on Thursday, October 20, 2011. Despite the fact that the company continues to contend against cigarette smuggling, PTC is able to achieve relatively better results in the outgoing quarter. The net turnover increased from 32.9 percent of sales in 3QCY10 to 34.4 percent in 3QCY11. Moving down, a considerable gain for the company abounded from a decrease of 21.33 percent in selling and distribution expenses in 3QCY11 as compared to the same period of last year, as these expenses fell from 6 percent of sales last year to 3.8 percent of sales this year. PTC reported an operating profit of Rs.682 million in the outgoing quarter. While the previous three months have witnessed improved performance; PTC has not fared as well in the first nine months of 2011 as compared to the same period of last year in terms of operating profit. Another factor that contributed to the increase in profit is the decrease in finance cost, which fell from Rs.54 million in 3QCY11 to Rs.23 million in 3QCY11. The relatively small fall in expenses throughout the income statement accumulated to become a handsome amount. Even though PTC underperformed in the first 9 months of 2011 still it seems to be gaining pace, as in the last quarter the companys earnings per share (EPS) stood at Rs.1.69, while its overall performance has also improved in recent months.

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Pakistan Tobacco Company
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(Rs mn)                        3QCY11     3QCY10       chg
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Net turnover                    5,547     4,243        31%
Cost of sales                   3,874     3,155        23%
Gross profit                    1,673     1,087        54%
Selling &distribution expense     612       778       -21%
PAT                               432       (54)          
EPS (Rs)                         1.69     (0.21)          
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Source: KSE notice