ANL 31.15 Increased By ▲ 0.47 (1.53%)
ASC 14.10 Decreased By ▼ -0.84 (-5.62%)
ASL 23.80 Decreased By ▼ -0.10 (-0.42%)
AVN 93.00 Increased By ▲ 1.00 (1.09%)
BOP 9.08 Decreased By ▼ -0.06 (-0.66%)
BYCO 9.69 Decreased By ▼ -0.56 (-5.46%)
DGKC 133.40 Decreased By ▼ -2.20 (-1.62%)
EPCL 51.22 Increased By ▲ 1.22 (2.44%)
FCCL 24.45 Decreased By ▼ -0.17 (-0.69%)
FFBL 24.10 Decreased By ▼ -0.15 (-0.62%)
FFL 15.40 Decreased By ▼ -0.20 (-1.28%)
HASCOL 10.78 Increased By ▲ 0.04 (0.37%)
HUBC 84.50 Decreased By ▼ -0.70 (-0.82%)
HUMNL 6.93 Decreased By ▼ -0.42 (-5.71%)
JSCL 23.98 Decreased By ▼ -0.87 (-3.5%)
KAPCO 37.05 Decreased By ▼ -0.80 (-2.11%)
KEL 4.05 Decreased By ▼ -0.10 (-2.41%)
LOTCHEM 14.40 Decreased By ▼ -0.38 (-2.57%)
MLCF 46.28 Decreased By ▼ -0.32 (-0.69%)
PAEL 36.65 Decreased By ▼ -1.60 (-4.18%)
PIBTL 11.54 Decreased By ▼ -0.26 (-2.2%)
POWER 10.25 Decreased By ▼ -0.25 (-2.38%)
PPL 89.80 Decreased By ▼ -0.75 (-0.83%)
PRL 25.00 Decreased By ▼ -1.10 (-4.21%)
PTC 8.78 Decreased By ▼ -0.17 (-1.9%)
SILK 1.40 No Change ▼ 0.00 (0%)
SNGP 37.70 Decreased By ▼ -0.40 (-1.05%)
TRG 139.98 Decreased By ▼ -1.12 (-0.79%)
UNITY 29.32 Decreased By ▼ -2.18 (-6.92%)
WTL 1.53 Decreased By ▼ -0.04 (-2.55%)
BR100 4,874 Decreased By ▼ -61.7 (-1.25%)
BR30 25,089 Decreased By ▼ -313.95 (-1.24%)
KSE100 45,338 Decreased By ▼ -526.54 (-1.15%)
KSE30 18,933 Decreased By ▼ -240.05 (-1.25%)

While FY19 was noted by lower sales but better profits for Al ShaheerFoords (ASC), recent results for the half year ended FY20 depict another picture. Liquidity troubles stunted growth in topline primarily, as the companywas unable to fulfill local and export orders, according to Kamran Khalili, CEO of Al Shaheer Foods.

With the lack of capacity to be able to cater to clients, the y tactic was to curtail costs which came about by restructuring within the organization. This included cutting down HR costs, laying off employees and shutting down loss incurring shops of Meat One, their retail outlet for selling meat.

During the first half of FY19, other income drove the company towards profitability which was primarily made up of a net exchange gain brought about by currency devaluation. However, with currency stabilization, this source of income was cut to size, reducing from Rs123 million in 1HFY19 to Rs8 million in 1HFY20.

Another factor which squeezed profits for the period year on year is the hike in finance costs which was more a factor of change in the way of recording expenditure on expansion. Initially it was capitalized, with a change in rule, it is now expensed out causing finance costs to swell.

The liquidity crunch led to rights share, the prime rationale for which is to fulfill working capital requirements. This essentially entails purchase of livestock and other raw materials. The company intends to raise Rs578 million of which 60 to 70 percent will be directed towards the working capital needs, in addition to clearing previous miscellaneous liabilities.

The company hopes to receive finance from rights issue soon and it will be utilised immediately. With the inflow of money and deploying it instantly, Kamran hopes to improve the topline by nearly 50 percent. The new poultry plant plans in Lahore, at the moment have been shelved in order to focus on realigning current business and operations.