Hi-Tech Lubricants Limited (HTL) announced its financial result for 4QFY21 whereby the company declared a profit after tax (PAT) of PKR 143mn (EPS: PKR 1.24) compared to profit of PKR 214mn (EPS: PKR 1.85) in 4QFY20. This takes FY21 profit to PKR 651mn (EPS: PKR 5.62) compared to profit of PKR 122mn (EPS: PKR 1.05) during SPLY. The jump in earnings during FY21 was owed to growth in volumes and higher selling prices. 

Along with the result the company announced a cash dividend of PKR 2.00/share (FY21: PKR 4.00/share), and a 20% bonus.

Result Highlights

• Topline of the company settled at PKR 3,344mn (highest ever quarterly sales) in 4QFY21, up by 74% YoY. The jump in sales is due to to massive growth in overall sales volumes. During FY21, topline witnessed a massive growth of 88% YoY to PKR 10,597mn due to growing demand for lubricants amid surge in automobile sales and rampant economic activity, as well as improvement in prices.
• The company posted a gross profit of PKR 579mn with gross margins set at 17.3% in 4QFY21 compared to gross profit of PKR 452mn (23.6%) in SPLY. The decline in gross margins is attributable to higher discounts offered in the quarter to attract new customers and increase market share in the highly competitive mid-tier and low-tier market segment. Similar trend was witnessed in FY21.
• Other operating income settled at PKR 24mn in 4QFY21, down by 1% YoY and 18% QoQ.
• Meanwhile, finance costs dropped by 14% YoY to PKR 38mn in lieu of lower interest rate in the period under review.
• The company recorded effective taxation at 9.0% in 4QFY21 compared to tax reversal in 4QFY20.

Courtesy – AHL Research