Al-Ghazi, which is one of the only two major players in the tractor industry, announced its financial results for the year ended December 31st, 2018. The company reported a net profit of Rs. 2.45 billion, down by 21.50% from Rs. 3.12 billion in the corresponding period last year.
Due to lower tractor sales during the last quarter and declining margins, the company saw a decline in its profits for the year ending in December 2018.
The company’s revenue was clocked in at Rs. 19.37 billion, which was up by 2.65% from Rs. 18.87 billion last year. The cost of sales was reported at Rs. 14.70 billion from Rs. 13.61 billion, up by 8%.
Accordingly, earnings per share declined to Rs. 43.31 compared to Rs. 53.88 last year.
According to Mohammad Shahid Hussain, CEO Al-Ghazi Tractors, the last 4/5 months were quite challenging for the local tractor industry with one of the lowest trends ever seen over the last few years bringing a massive slow down while leading to considerable non-utilisation of capacity.
During the year the company sold 23,933 units, down by 2% in 2018 as compared with 24,423 units in 2017. The volumes saw a decline due to a slowdown in agricultural growth and Rupee’s devaluation against US dollar over the year which increased raw material prices.
Distribution and administrative expenses were noted at Rs. 276 million and Rs. 305 million.
Al-Ghazi Tractors announced a final cash dividend of Rs. 9 per share, which is an addition to the interim dividend already paid at Rs. 30.
AGTL’s shares at the bourse were trading at Rs. 498.01, down by Rs. 5.99 or -1.19% with a turnover of 150 shares on Wednesday.
The company manufactures different tractor variants as well as generators and agricultural implements like cultivators, plows, sprayers, etc. It has a technical collaboration with CNHI – Case New Holland to manufacturing Holland (Fiat) tractors in Pakistan.