• Systems Limited (SYS) today unveiled the financial result for 9MCY24, posting a consolidated profit after Tax (PAT) of PKR 5,432mn (EPS: PKR 18.6) against PKR 7,146mn (EPS: PKR 24.5) in 9MCY23, down by 24% YoY. Whereas, consolidated earnings 3QCY24 clocked in at PKR 2,188mn (EPS: PKR 7.5), up 18% YoY.

Result Highlights       

• Net sales in 9MCY24 were PKR 48,310mn, up 29% year over year. Moreover, the top line grew by 22% year over year to PKR 17.2bn during 3QCY24, mainly due to dollarized revenue growth in all verticals.
• During 9MCY24, gross margins declined by 430bps YoY. This reduction was predominantly driven by inflationary adjustments in compensation, rising energy costs, and a lower average exchange rate. The gross margins during the quarter declined to 25%, down by 290bps YoY due to the aforementioned reasons.
• Administrative and distribution expenses grew by 15%/26% YoY/QoQ during the outgoing quarter, possibly due to inflationary pressure and an increase in the resource pool.
• Other income for the quarter clocked in at PKR 186mn during the quarter, up by 4% YoY due to interest income from subsidiaries and an increase in cash and cash equivalent.
• During 3QCY24, finance costs declined by 60% YoY while down by 30% QoQ, owing to lower short-term borrowings.
• The company booked effective taxation at 9.9% in 3QCY24 vs. 6.4% in SPLY. This increase in taxation was due to higher tax rates applicable in the UAE region from this year.

Courtesy – AHL Research