D.G. Khan Cement likely to post a profit in 1HF21

• D.G. Khan Cement Company Limited is scheduled to announce its 2QFY21 financial result on 19th February 2021. We expect the Company to post PAT of PKR 1.02bn compared to the loss of PKR 351mn in the preceding quarter. This will bring 1HFY21 PAT to PKR 677mn (EPS: PKR 1.55).

• The turnaround in earnings is mainly attributed to improved retention price, resumption of dividends from group companies, and low finance cost.

• Net sales are expected to clock in at PKR 11.5bn, up by 9% QoQ. While gross margins likely to clock in at 19% compared to 13% in the SPLY on the back of a reduction in FED by PKR 500 per ton and an increase in cement prices.

• Distribution expense likely to fall 15% QoQ as exports plunge in 2Q. • Other income to surge 2.46x QoQ on the resumption of dividend from group companies except for MCB.

• Finance cost to decline by 30% QoQ on the reduction in debt and low-interest rate.

D.G. Khan Cement Company Limited, (DGKCC) is amongst largest the cement manufacturers in Pakistan with 22,400 tons per day (6.72 million tons/annum). DGKCC has four cement plants, two plants located at Dera Ghazi Khan, one at Khairpur Distt. Chakwal and one at Hub Lasbela District (Balochistan). All the plants are based on the latest Dry Process Technology.

The Company operates through a countrywide distribution network managed by different Regional Sales offices. The Company’s products are preferred on national reputation projects, both locally and internationally due to its unparalleled and consistent quality. The Company is listed on Pakistan Stock Exchanges. (Company sources)

Courtesy – Spectrum Research

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