Lucky Cement sees double-digit profit growth

Lucky Cement sees double-digit profit growth
02 May 2022

Lucky Cement Limited has reported profit after tax on a consolidated basis of PKR26.53bn (US$142.9m), of which PKR5.81bn was attributable to non-controlling interests, in the nine months ending March 31, 2022. This translates into earnings per share (EPS) of PKR64.07, compared to PKR56.36 in the same period a year earlier. The company saw gross turnover of PKR265.70bn, up 31.2 per cent YoY. Consolidated net profit, attributable to the owners’ of the holding company, advanced by 13.7 per cent over the same period.  

Despite the challenges due to increasing production costs across all segments, the group has been able to secure double-digit profit growth. The increase in net profit was mainly attributed to the impressive performance of the group’s chemicals business and overseas cement segment. Its Polyester, Pharmaceutical and Animal Health segments reported growth of 30.4, 56.7 and 95.9 per cent, respectively, in operating results, compared to the same period last year. This was achieved on the back of enhanced volumes, a better sales mix and new product launches in the pharmaceutical segment.

This increase is in addition to the one-off unrealised gain on the acquisition of controlling shares in NutriCo Pakistan amounting to PKR1.85bn. The group’s joint venture cement production facility in Samawah, Iraq, which started commercial production in March 2021, has also contributed favourably to the group's profitability.

In March 2022, a major milestone was achieved when Lucky Electric Power Company Limited, a wholly-owned subsidiary of Lucky Cement, started commercial operations of its 660MW coal-fired power project. This addition to the national grid will not only play a key role in increasing the energy security and prosperity of Pakistan, but will also reduce the cost of electricity and reliance on imported fuel in the long run following completion of Phase III of the expansion of Sindh Engro Coal Mining Company’s (SECMC) lignite coal mine in the Sindh province in June 2023.

On an unconsolidated basis, the company's local sales volumes posted a 3.4 per cent decline reaching 5.51Mt during the nine-month period. This marginal decline for the company compares to a negligible change in the industry numbers, mainly due to other cement plants becoming operational in the current period.

Export sales volumes by Lucky Cement contracted by 18 per cent to 1.56Mt, compared to 1.9Mt in the same period a year earlier, due to continuous volatility in international coal prices and exorbitantly high freight costs globally. Therefore, the overall sales volumes of the company declined by 7.1 per cent to reach 7.07Mt.

Published under Cement News

Tagged Under: Lucky Cement Results Pakistan