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Pak Suzuki Posts Big Loss In Half Year Despite Profitable Quarter

Pak Suzuki Motor Company Limited, the largest player in Pakistan’s automobile industry, has announced its financial results for the half year that ended on 30 June 2022.

It reported a profit of Rs. 442.98 million during the 2nd quarter of 2022, up by 5.73 percent as compared to a profit of Rs. 418.96 million in the same period last year, according to a notice sent to the Pakistan Stock Exchange (PSX).

This takes that half-year results to a loss of Rs. 17.23 million during the first half of 2022 compared to a profit of Rs. 1.19 billion in the same period last year.

However, Pak Suzuki Motor Company Limited’s (PSMC) net sales during the second quarter increased to Rs. 64.88 billion, up by 116 percent as compared to Rs. 30 billion recorded in the same period last year. The increase in sales was due to higher volumetric sales (40,860 units vs 22,020 in 1QCY21), increase in prices throughout the year and the success of Suzuki Swift’s new variant.

The company’s cost of sales increased by 120 percent year-on-year (YoY) to Rs. 62.02 billion from Rs. 28.26 billion due to rising commodity prices, devaluation of the Pakistani Rupee and high freight costs.

The gross margins during the period contracted to 4.4 percent during the 2nd quarter from 5.8 percent owing to higher input costs and the rupee’s devaluation.

Other income of the company was increased by 318 percent to Rs. 1.03 billion from Rs. 247.58 million.

The financial charges increased by 18.2x to Rs. 811 million during the 2nd quarter of 2022 from Rs. 42.13 million in the same period last year due to higher interest rates in the country.

Earnings per share of the company increased to Rs. 5.38 from Rs. 5.09.

Pak Suzuki’s scrip at the bourse was closed at Rs. 176.24, down by Rs. 4.14 or 2.30 percent, with a turnover of 402,441 shares on Thursday.