Millat Tractors Limited (MTL) announced the financial result for the period ended 30th Mar’23 whereby the company’s unconsolidated Profit After Tax (PAT) stood at PKR 1,280mn (EPS: PKR 10.01) during 3QFY23 as compared to PAT of PKR 1,656mn (EPS: 12.95) in SPLY. This took the 9MFY23 earnings to PKR 2,127mn (EPS: PKR 16.63), down by 55% YoY.

Result Highlights

· Net sales settled at PKR 16.9bn during 3QFY23, up by 23% YoY, on the back of a recovery in tractors demand. This took 9MFY23’s sales revenue to PKR 30.3bn, down by 21% YoY.

· Gross margins shrunk and were recorded at 17.2% during 3QFY23 vs. 20.3% in SPLY. Gross margins also declined sequentially by 131bps, owing to increased cost pressure, due to inflated raw material costs and massive PKR depreciation of 20.2% in the outgoing quarter.

· Other income declined by 29% YoY to PKR 1,634mn during 3QFY23, given the reduction in cash and cash equivalents during the period as the company has been facing a liquidity crunch in lieu of a delay in sales tax refunds.

· The company booked effective taxation at 21.7% in 3QFY23 as compared to 28% in 3QFY22.

Courtesy – AHL Research