LAHORE: The retail stores of Gul Ahmed Textile Mills Limited (GATM) across the country had remained closed for approximately eight weeks, owing to which the company has registered a revenue loss of Rs8 billion.
This was revealed during the company’s corporate briefing session on Monday, wherein the management discussed GATM’s current performance and outlook.
The retail segment has not yet normalised, as stores are operating under shorter timings (closed on weekends which is usually peak sales time). However, the management commented that for the month of June 2020, textile-related exports are expected to the cross $1 billion-mark.
Hammad Akram, a research analyst at Topline Securities, said GATM has sufficient export orders in hand till November 2020, adding that the company has started to export products related to the healthcare segment, which mainly includes protective gowns, scrubs and masks etc.
The GATM management, during the meeting, highlighted that due to Covid-19, consumption patterns of consumers have changed significantly and every segment would be impacted in a different way.
According to Akram, the home textile segment is expected to grow in the future as its demand has increased significantly since people are spending more time at homes in the wake of the pandemic.
“However, the apparel segment is likely to suffer due to its luxury nature, since consumer spending has witnessed an overall decline,” he said.
Akram informed that the GATM’s sales from e-commerce are expected to cross Rs1 billion in FY20, as against Rs0.5 billion in FY19. “During 9MFY20, the capacity utilization of spinning was 86pc, while weaving & processing was operating at 89pc utilization level.”
On possible impact of locust on cotton crop yield, the GATM management commented that they currently have sufficient inventory of cotton. However, a significant decline in cotton output can lead to higher cotton imports and higher prices, which can have a negative impact on margins.