Pak Suzuki Motor Company (PSMC), the country’s largest car maker in terms of market share, recorded a 38 percent rise year-on-year in its profit at Rs. 1.99 billion for the half-year ending on June 30, 2017.
This translated into earnings per share (EPS) of Rs 24.20 as compared to 1.43 billion or an EPS of 17.44 during the same period last year, according to a company notice sent to the Pakistan Stock Exchange (PSX) on Tuesday.
PSMC also revealed its 2nd quarter earnings of PKR 685 million for 2017. This resulted in EPS of Rs 8.33. The revenues grew 21% YoY for the same period, on account of an increase in unit price and volumetric growth.
The share price of Pak Suzuki ended at Rs. 646.74, down by Rs 3.92 on Tuesday as the market closed.
“The results of Pak Suzuki were below market expectations” Topline Securities commented in its report.
Pak Suzuki’s higher volumes were supported by sales of ‘Wagon-R’ and the new ‘Cultus’ (introduced in April 2017). The company sold 29,301 units during Q2 2017, up 8% YoY followed by a 13% increase in prices. Prices of Wagon-R (VXL Variant) increased by Rs 196,000 to Rs 1,250,000.
In terms of volumetric growth, Wagon-R remained the most impressive variant with its sales volume reaching up to 5,076 units in 2nd quarter up 78% year on year.
On YoY basis, gross margins declined marginally to 8% during Q2 2017. Net revenues declined by 4% in Q2 2017. Decline in margins was recorded at 3% YoY due to the appreciation of the Japanese Yen and an 11% increase in steel prices.
Selling/distribution and administration expenses increased by +24% and +11% to PKR 675 million and PKR 543 million respectively, offsetting the increase in gross profit.