Nishat Chunian saw higher sales and improved gross margins in 3QFY24

Nishat Chunian Limited (NCL) announced its 3QFY24 results today. The company posted an unconsolidated NPAT of PkR381mn (EPS: PkR1.6) compared to a loss of PkR991mn (LPS: PkR3.8) in the quarter before. The turnaround to profitability is primarily due to higher sales and improved gross margins. Overall, the result surpassed our expectations of PkR0.4/sh.

  • Total revenue was PkR24.2bn vs. PkR20.1bn (↑20% YoY), likely driven by a seasonal uptick in sales (Eid festivities) coupled with increased selling prices.
  • Gross margins improved by 1.5pps, clocking in at 12.2% vs 10.7% in the preceding quarter. The said improvement is possibly due to the aforementioned higher selling prices.
  • Distribution expenses increased by 14%QoQ to PkR624mn, mainly attributable to higher transportation charges amidst volumetric growth.
  • Finance costs were PkR1.8bn, lower by 17% QoQ, possibly due to reduced debt and a slight decline in average KIBOR rates.
  • That reduces 9MFY24’s bottom line to a loss of PkR0.1/sh vs. an LPS of PkR6.0 in SPLY. Overall, the loss reduction is primarily due to higher sales and improved gross margins.

Courtesy – AKD Research

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