Kohat Cement Co profits grow by 24% in 1HFY23-24

Kohat Cement Co Ltd announced its financial result for 1HFY23-24 on the Pakistan Stock Exchange website on 14 February, posting a profit after tax (PAT) of PKR4.453bn (US$15.9m) compared to a PAT of PKR3.578bn in the same period last year (SPLY). This translates into a growth of 24 per cent YoY. On the other hand, the profitability in 2QFY23-24 advanced by 14 per cent YoY to PKR2.224bn compared to SPLY.

According to AHL Research, the topline during 1HFY23-24 clocked in at PKR21.462bn, slightly increasing by two per cent YoY compared to PKR20.972bn in the year-ago period, amid higher retention prices. Gross margins for 1HFY23-24 arrived at 28 per cent compared to 25 per cent in SPLY on the back of higher cement prices in tandem with the decline in coal prices. Other income in 1HFY23-24 surged by 112 per cent YoY to settle at PKR2.066bn due to an increase in short-term investments.

The IMS Research believed that Kohat Cement's declining margins have been offset by significant other Income. The company will continue facing cost pressures, given the persistent upward stickiness of prices of Afghan coal and the implementation of the axle load regime, which diminishes the viability of imported coal. Furthermore, the higher reliance on grid electricity will continue to pressure margins. 

The plant of Kohat Cement Co Ltd in Khyber Pakhtunkhwa has a capacity of 5.017Mta.