Pakistan’s oldest software house, Systems Limited has announced its financial results for the first quarter of 2020.
The software house continued its growth as its consolidated profits soared by 71.15% for the period under review. The company reported a profit of Rs. 526.80 million as compared with a profit of Rs. 307.80 million in the same period last year.
The results were above the market expectations due to higher sales, high other income, and lower other operating expenses.
The company’s profitability increased due to 11% year on year rupee’s depreciation in 1Q CY20, higher domestic sales due to automation drive by public/private sectors, growing business, better margins from the North America region and positive response from European markets and increased recurring revenue from MEA operations.
Systems Limited’s financial health is continuously improving due to the rupee devaluation and the export rebate which has positively impacted the revenue growth as most of its revenue comes from the exports.
Sales landed at Rs. 2.23 billion, translating into a 39.30% increase as compared with Rs. 1.60 billion in the same period last year.
However, the cost of sales of the company was posted at Rs. 1.58 billion, up by 42% in the first quarter as compared to Rs. 1.11 billion in the same period last year. This took the gross profits to Rs. 649.67 million as compared with Rs. 486.81 million, showing an increase of 33.45%.
Other income of the company saw an increase of 4.86x to Rs. 202.65 million as compared with Rs. 34.55 million in the same period last year.
The finance cost saw an increase of 104.50% to Rs. 11.19 million as compared with Rs. 5.47 million owing to an increase in interest rates in the country during the period. Earnings per share of the company increased to Rs. 4.31 from Rs. 2.78.
At the end of the day, System’s share at the bourse was closed at Rs. 147.75, up by 7.49% or Rs. 10.30, with a turnover of 0.19 million shares.