Honda Atlas has posted a 57.38% decline in its net profit as it plunged down to Rs. 601 million, from Rs 1.41 billion, in the third quarter which ended on December 30, 2018.
The net sales fell slightly by 2% to Rs. 21.29 billion from Rs. 21.79 billion during this quarter on the back of 11% decline in volumetric growth which restricted the impact of higher prices.
| Units Sold in Third Quarter | |||
| Models | Units Sold in 3Q19 | Units Sold in 3Q18 | Difference |
| Civic and City | 9623 | 9087 | 6% |
| Honda BR-V | 1201 | 3088 | -61.11% |
| Total | 10824 | 12175 | -11.1% |
There was a small growth in sales volume of “City & Civic” whereas demand for BR-V witnessed a decline of 61.11% YoY during the period under consideration.
Earnings per share (EPS) decreased to Rs. 4.21 in Oct-Dec 2018 compared with Rs. 9.92 in the corresponding quarter a year ago. The company did not announce any dividends for the 3rd quarter. The result was below market expectations, said the analysts.
Overall, gross profits fell by 29% to Rs. 1.62 billion as compared with Rs. 2.27 billion in the corresponding period which is mainly a reflection of the decline in margins.
The drop in gross margins is attributed to the company’s inability to pass on the full impact of currency devaluation against US dollar of 26%, increase in duties of key inputs and higher commodity prices in Q3MY19.
To pass on the impact of this devaluation, Honda increased the prices in the range of Rs. 50,000-100,000 (compared to Q2MFY19) with effect from Nov 2018.
However, currency devalued during Q3MFY19 by 11% hit the profitability during the latter part of the quarter, according to Foundation Securities.
Distribution expenses were up by a staggering 85% to Rs. 291 million as compared with Rs. 157 million in the previous year while administrative expenses increased by 14% to Rs. 171 million.
Other income dropped by 50% to Rs. 230 million owing to lower expected cash available in Q3MY19.
HCAR’s script at the bourse closed at Rs. 238.75, down by 4.53% or Rs. 11.33 with a turnover of 2.75 million shares on Thursday.
Analyzing the Situation:
Allowing non-filers purchasing motor vehicles under 1300cc and below would prove positive for the local auto sector but Honda Atlas Cars (HAC) may face problems as it only sells vehicles which are above 1,300cc in Honda Civic and City models.
However, duty on cars above 1800cc has been increased which is positive for Honda Atlas and Indus Motors as this would discourage imports of 1,800cc cars.
A post about Honda has the main image of Renault Duster??
And the writer misunderstood it for BRV, ???,
Does anybody checks posts before being published, pls rectify it
The news should have included performance of all Auto makers in Pakistan. Not just Honda.
As soon as the result will be announced, We will do it.
Dollar prices maybe the reason but the truth us honda,s quality is go down with every car or model honda is not giving value for money to its customers resale is very bad and parts are much expensive then toyota honda is using its city design from 2009 almost 9 years even suzuki is doing better then honda