Lotte Chemicals has continued its strong trajectory of rising sales and profits as it has reported an increase in profits for the year ended December 31, 2019.
Lotte posted a profit of Rs. 5.54 billion, which is up by 25.8% as compared with a profit of Rs. 4.43 billion in the corresponding period last year.
The company has reported net sales of Rs. 60.53 billion, up by 5.47% from Rs. 57.40 billion in the corresponding period last year. The cost of sales were reported at Rs. 52.66 billion, which was increased by 5.30% as compared with Rs. 50.01 billion recorded in the same period last year.
The sales increased on the back of improved average volumetric sales throughout the year with rupee’s devaluation against the US dollar and on the back of lower PTA prices (Purified Terephthalic Acid).
PTA is a base raw material for Pakistan’s textile and polyethylene terephthalate (PET) packaging industries. Paraxylene is widely used as a feedstock (or “building block”) to manufacture PTA. Furthermore, being a petrochemical, prices of PX and PTA are linked with international oil prices.
This took the gross profits to Rs. 7.87 billion, showing a growth of 6.70% as compared with Rs. 7.38 billion 2018.
Lotte’s distribution and selling expenses were noted at Rs. 103.51 million against Rs. 102.44 million and other expenses were posted at Rs. 642.81 million against Rs. 555 million. The finance cost of the company decreased by 69.02% to Rs. 156.49 million against Rs. 505.12 million.
However, other income of the company saw an increase 138.80% to Rs. 1.22 billion as compared with Rs. 514 million recorded in the same period last year. This was due to higher income earned on bank deposits.
LOTTE’S scrip at the bourse closed at Rs. 13.76, down by Rs. 0.62 or -4.31%, with a turnover of 13.14 million shares on Friday.
LOTTE Chemical Pakistan Ltd. is the only world-class manufacturer of Purified Terephthalic Acid (PTA), which is the primary raw material for Polyester and PET.