Toyota Pakistan Records a Slight Decrease in Quarterly Profits to Rs. 3.5 Billion

The second largest automotive assembler in the country, Indus Motors (PSX: INDU) posted quarterly profits of Rs 3.5 billion, down by 3.32% as compared with Rs 3.62 billion in the same period last year.

Earnings per share of the company currently stand at Rs 44.63, down from Rs 46.17 in the quarter.

The company has also declared an interim cash dividend of PKR 32.52/share along with its financial result.

Net sales of the company grew by 12% to Rs 34.9 billion during Q1FY19 on the back of 6.7% YoY volumetric growth in sales. The gross profit was down by 7.04% due to the high cost of sales which were up by 16.12%.

The rise in the topline is mainly due to a modest growth in volumetric sales (2%) in Q1FY18 coupled with an increase in prices for all variants by an average of 10-15%.

Sales Figures

Models Units Units
1QFY18-19 1QFY17-18 Difference
Toyota Corolla 13,196 12,765 3.38%
Toyota Fortuner 606 792 -23.48%
Toyota Hilux 1,617 1,530 5.69 %
Total Sales (Units) 15419 15087 2.2%

Flagship Corolla saw a 3.38% increase in sales along with Toyota Hilux.

The gross margins during Q1FY19 contracted by 2.9pps YoY to 14.5% mainly due to the rise in raw material costs as a result of the recent PKR devaluation and increase in commodity prices.

The company’s Distribution and Administrative expenses showed a growth of 2.61% and 3.78% respectively; while the company’s other operating expenses increased by a whopping 106.74%.

The other income saw an increase of 22.39% to Rs 1.05 billion and finance cost decreased by 33.53% from the last year.

Even though the Finance cost and Income tax expenses decreased by 33.53% and 1.79%, the overall impact on the bottom-line earnings was negative nonetheless.

Increase in Prices

For the fourth time this year, Indus Motor Company (IMC) had increased the prices of its cars by Rs 50,000 to Rs 175,000 for deliveries from November & December and by Rs 100,000 to Rs 350,000 for deliveries from January 2019 following the depreciation of the rupee last week. The price increase will only restore its margins, which had been battered due to the weaker exchange rate, said the experts.

INDU’s shares at the bourse were trading at Rs 1310, down by Rs 38.48, with a turnover of 8600 shares.