National Foods posted an astonishing 152.9 percent year on year increase in net profit. This feat can be attributed to the companys growing sales and improved margins. In the third quarter financial reports of FY12, the company highlighted how its international sales figures have improved with a top line sales value growth of 29.9 percent. Also massive growth in the domestic market was seen this year with a growth in sales of over one billion rupees. The company has been striving to improve margins and so it has delivered with gross margins coming up to 32.5 percent from 28.5 percent and operating margin coming up to 12.7 percent from 8.8 percent in FY11. A significant year-on-year decline in finance cost of 43.5 percent and controlled overheads complement the managerial competencies at National Foods. Distribution costs have been contained to 16.6 percent of sales; the same level as last year. National Foods current success is an outcome of the companys consistent efforts to improve its market presence through advertising and promotional activities like the companys participation in the Gulf Food Competition in FY11, which has reaped promising sales figures in the international market. These sound reports have stemmed themselves into the Karachi Stock Exchange with the stock price closing in at Rs249.5 on September 7, 2012 which stood at just Rs73 at the start of FY12; a massive 341 percent jump over the span of 14 months.
=============================================== NATIONAL FOODS LIMITED =============================================== (Rs mn) FY11 FY12 chg =============================================== Sales 5,521 7,169 30% Gross profit 2,331 2,331 48% Operating Profit 487 907 86% Finance Cost 126 71 -44% Profit After Taxation 231 583 153% EPS (Rs) 5.56 14.07 ----------------------------------------------- Source: KSE notice ===============================================
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