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Indus Motor Company (IMC) reported on Monday a profit-after-tax (PAT) of Rs9.66 billion in fiscal year 2022-23 (FY23), a decrease of nearly 39% as compared with earnings of Rs15.8 billion in the same period of the previous year.

Earnings per share (EPS) stood at Rs123 in FY23 compared with Rs201 in FY22. The board of directors of the assembler of Toyota vehicles in Pakistan met on August 25 to review the company’s financial and operational performance in the year ended June 30, 2023.

Along with the result, the company declared a final cash dividend of Rs29 per share. This was in addition to the already paid combined interim cash dividend of Rs42.8 per share, taking the full year divided to Rs71.8 per share.

On a quarterly basis, Indus Motor’s PAT was up by 19%.

During FY23, the auto assembler posted revenue to the tune of Rs177.71 billion, as compared to Rs275.5 billion, a decline of 35%.

“For FY23, the topline faced an annual contraction of 35% due to a significant 58% decline in sales volumes, with 31.1k units sold compared to 74.5k units in the corresponding period,” said AKD Securities, in a report.

IMC’s gross margins lowered to 4.5% in FY23, compared to 6.7% in FY22. This can be attributed to high cost of goods sold during FY23.

Operating expenses remained largely unchanged at Rs4.49 billion in FY23, compared to Rs4.53 billion in FY22.

The company saw its other income improved 10%, from Rs12.94 billion in FY22 to Rs14.18 billion in FY23. “This is attributable to interest rate hikes,” said AKD Securities.

Similarly, Indus Motor’s finance cost increased significantly to Rs140.73 million in FY23, compared to Rs114.3 million in FY22, an increase of 23%.

During FY23, the company paid Rs7.13 billion in taxation, as compared to Rs9.65 billion, however, the effective tax rate was higher at over 42% in FY23 compared to ETR of 38% in FY22.

Auto woes

Despite securing a last-minute deal with the International Monetary Fund (IMF), industries and consumers in Pakistan are still facing the economic woes they faced head-on earlier.

The country’s auto sector is especially facing economic headwinds, including the sector inability to secure Letters of Credit (LCs) needed for imports.

In addition to the LC issue, the sector is also faced with depressed demand due to higher prices and record-high interest rates. A falling rupee is not helping either.

Car sales dropped by whopping 57% year-on-year (YoY) in the first month of the fiscal year 2023-24, as per data given by Pakistan Automotive Manufacturers Association (PAMA).

The registered car manufacturers with PAMA cumulatively sold only 5,092 units in the month of July.

The month-on-month (MoM) decrease stood at 16%, as per the data.

Comments

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Arshad Aug 28, 2023 05:06pm
I am Glad......
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Tulukan Mairandi Aug 28, 2023 05:11pm
Obviously as people are turning to donkeys instead of cars and bikes
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Sitwat Jehan Aug 28, 2023 08:14pm
Thank you neutrals for installing PDM and this caretaker
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