DG Khan Cement posts Rs9 billion profit for fiscal 2018

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KARACHI: DG Khan Cement Company Limited posted a consolidated net profit of Rs8.93 billion in the fiscal ending June 30, 2018, up by 13.82% as compared to Rs7.85 billion in the previous year.

The accretion in the earnings can be attributed to tax credit from Hub plant expansion. Due to the tax reversals (credit) of Rs1.6 billion, the company was able to post a profit of Rs8.93 billion.

The company announced a final cash dividend of Rs4.25, i.e. 42.50% per share, with earning per share of the company growing to Rs20.25 from Rs18.01.

DG Khan’s sales increased by 3.05% to Rs33.46 billion but due to a greater increase in the cost of sales which saw an increase of 21.13% from the previous year. The gross profits went down by 27% to Rs8.81 billion as compared to Rs12.12 billion.

Among others, non-core expenses, during the year, increased by more than double the amount on a year-on-year basis, thus resulting in a 34% decline in pre-tax profits.

The administrative expenses saw an increase of 14.38% whereas selling and distribution expenses saw a decrease of 7.70% during the year. The finance cost grew to 40% from the previous year.

Furthermore, the board of directors has recommended the renewal of working capital loan of Rs1 billion extended to Nishat Hotels and Properties Limited, an associated company, at the markup rate of 1 month KIBOR plus 0.5% for a period of one year starting from the date of approval by the shareholders.

It also announced an equity purchasing of 7,596,000 shares of Adamjee Insurance Limited, another associated company from the open market, from time to time for a period of three years.

DGKC’s scrip at the PSX closed at Rs107.07, up by Rs1.72 with a turnover of 4.72 million shares Wednesday.