Honda Atlas Cars’ profit-after-tax plunges 78% in April-June
- Quarterly earnings fall from Rs658.2mn to Rs144.96mn on a yearly basis as sales see nearly 90% decline
Honda Atlas Cars (Pakistan) Limited (HCAR), one of Pakistan’s car assemblers, saw its profit-after-tax (PAT) plummet 78% year-on-year in the first quarter (April-June) of its fiscal year 2023-24.
As per HCAR’s financial statements made available at the Pakistan Stock Exchange (PSX) on Tuesday, the automobile company’s after-tax profit clocked in at Rs144.96 million in April-June 2023, as compared to PAT of Rs658.202 million recorded in the same period of the previous year.
Accordingly, the company’s Earnings per share (EPS) clocked in at a mere Rs1.02 in 1QFY24, compared to Rs4.61 in SPLY.
Experts said the decline in profit comes on account of a massive decline in sales, which stood at Rs3.77 billion in 1QFY24, as compared to Rs30.25 billion in SPLY, a plunge of 88%.
On the other hand, cost of goods sold exceeded sales at Rs3.92 billion in 1QFY24, which resulted in a gross loss of Rs148.38 million, as compared to a gross profit of Rs1.915 billion recorded in the same period last year.
However, despite the gross loss, HCAR saw an improvement in its other income, which amounted to Rs902.686 million in 1QFY24, in comparison to Rs526.665 million in 1QFY23.
The company managed to post Profit before Taxation (PBT) of Rs267.695 million in 1QFY24, down by 76% YoY.
Incorporated in Pakistan as a public limited company in 1992, HCAR commenced its commercial operations in 1994. The company was formed as a result of a joint venture between Honda Motor Co., Ltd., Japan and Atlas Group of Companies, Pakistan. The company is engaged in the assembly and progressive manufacturing and sale of Honda vehicles and spare parts.
Pakistan’s automobile industry took a massive dent in fiscal year 2022-23 as car sales plunged 56% to just 126,879 units, as per data shared by Pakistan Automotive Manufacturers Association (PAMA) earlier this month.
The huge decline was attributed to the non-availability of completely knocked down kits (CKDs), high car prices, surge in auto financing and low purchasing power of buyers.
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