Pakistan’s listed sugar sector has reported a 78% year-on-year increase in profits, reaching Rs 22 billion for the fiscal year 2023.
According to a note by Topline Pakistan Research, the sector’s remarkable performance is attributed to a rise in sugar exports, which has led to increased sugar prices domestically, boosting gross margins to new heights.
Net sales of the sugar sector soared by 29% to Rs 304 billion in FY23, mainly due to the export of 249,000 tons of sugar and a 28% hike in average domestic prices.
The ethanol by-product market also saw an improvement, benefiting from favorable international selling prices and the devaluation of the Pakistani rupee against the US dollar.
In January 2023, the federal government allowed the export of 250,000 tons of sugar, subject to the condition that proceeds in dollars would be recovered from sugar exporters within 60 days from when the letters of credit (LCs) are opened.
The sugar industry capitalised the government’s decision and exported nearly the entire quota as per the Pakistan Bureau of Statistics (PBS).
This export policy, however, exerted upward pressure on domestic sugar prices, which peaked at Rs166/kg in September 2023, a 90% increase from October 2022. Prices have since moderated to Rs147/kg.
On the global stage, international sugar prices witnessed a 45% increase from $18.30 cts/Ib in October 2022 to $26.60 cts/Ib in September 2023, before settling at $21.40 cts/Ib.
The sector’s average gross margins improved from 15% in FY22 to 18% in FY23 due to enhanced retention prices.
Despite these gains, the sector faced challenges with a 38% jump in selling and distribution expenses, in line with increased sales volumes and the prevailing inflationary environment. Finance costs also surged by 60% to Rs 18 billion in FY23, up from Rs 11 billion in FY22, constrained by higher interest rates and increased borrowing for working capital, the brokerage note said.
Leading the profit surge, Shahmurad Sugar Mills emerged as the top performer, contributing 18% to the total sector profit, followed closely by Al-Abbas Sugar Mills and Habib Sugar Mills.
A few companies outshone their peers with higher net profit margins, primarily driven by the robust performance of the ethanol segment, better international ethanol prices, and the rupee’s devaluation.
I’ve been researching a very interesting subject, and I believe this to be among the most crucial details. Moreover, I liked reading your content.
MY PERSONAL EXPERIENCE ON LOST CRYPTO RECOVERY!
I read so many stories about bitcoin loss to scams. I will like to start by saying the agencies responsible for bitcoin security has really done nothing to help locate stolen or lost coins. In my situation my MacBook was hacked by someone that had access to my emails, i immediately contacted blockchain and they only wasted my time, after which i worked towards getting help else where, i was referred to consult a bitcoin expert who helped track and retrieved my 3.3 btc, for an agreed fee. I was more than grateful and willing to pay more after the job was done. Thankful i didn’t fall victim and would like to recommend ( MORRIS GRAY 830 @ G maiL . COM )
As someone who has utilized PapersOwl’s services extensively, I can confidently attest to its reliability. Throughout numerous assignments, the quality of work delivered has consistently met or exceeded expectations. Their team of writers demonstrates professionalism and expertise across various subjects. Not only is PapersOwl reliable in terms of timely delivery and adherence to instructions, but their customer support is also commendable, always responsive and helpful. I’ve never encountered any issues with plagiarism or grammar errors, ensuring the papers are of high academic standard. Overall, I highly recommend PapersOwl for anyone seeking dependable essay writing assistance.