Amreli Steels Limited announced its 4QFY23 results, where the company posted a LAT of PkR969mn (LPS: PkR3.26), marking a 304% decrease when compared to a PAT of PkR476mn (EPS: PkR1.60) last quarter. This decrease is mostly attributed to a 1048% increase in tax charges and a 9% increase in finance costs QoQ. The company has not announced any dividends.

· Topline for the quarter fell by 7%QoQ to PkR10.8bn, while reflecting a 19% decline on yearly basis. The said decline is possibly due to decrease in volumes, taking into account falling LSM (FY23: down 14.93%YoY) and imposed LC restrictions.

· Given regressed sold volumes, GMs also fell to 13% in 4QFY23 vs. 18% in 3QFY23.

· On the operating front, distribution costs rose by 7% QoQ to PkR263mn and administrative expenses increased by 17% QoQ to stand at PkR225mn. Finance costs saw a slight increase of 9%QoQ to end at PkR1,1bn, introspecting a possible increase in short term borrowings.

· Taxes saw a massive jump of 1048% to end at PkR814mn, attributable to retrospective implementation of super tax and a possible deferred tax charge (ET: 524% vs. 13% for 3QFY23).

Courtesy – AKD Research