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Millat Tractors’ Profit Declines by 38% in FY23

Millat Tractors Limited (PSX: MTL) announced its financial result for the period ended FY23 whereby the company’s unconsolidated Profit After Tax (PAT) stood at Rs. 3.378 billion, down 38 percent YoY compared to PAT of Rs. 5.407 billion in the same period last year.

During 4QFY23, the company posted a PAT of Rs. 1,251 million (EPS: Rs. 6.52), up by 72 percent YoY compared to Rs. 726 million (EPS: Rs. 3.78) during 4QFY22. Along with the result, the company announced a final cash dividend of Rs. 15 per share, taking the full-year payout to Rs. 25 per share.

Topline during FY23 declined by 17 percent YoY, clocking in at Rs. 44,191 million. According to Arif Habib Limited, this was due to a decline in volumetric sales (-47 percent YoY) and a challenging economic environment. On a quarterly basis, the net sales reduced to Rs. 13,893 million during 4QFY23, down by 7 percent YoY, driven by persistently low volumetric sales due to diminished demand and reduced consumer affordability.

Gross margins settled at 20 percent during FY23, marking a slight increase as compared to 19.1 percent in SPLY. This improvement can be attributed to the effects of price increments. Notably, during 4QFY23, the gross margins exhibited robust growth, reaching 25.4 percent.

Other income portrayed a decline of 49 percent YoY to record Rs. 471 million during FY23 owed to lower income from cash and cash balances. The company booked effective taxation at 51 percent in 4QFY23 vis-à-vis 68 percent in 4QFY22.

The company’s earnings per share (EPS) stood at Rs. 17.61 for the period under review compared to an EPS of Rs. 28.19 reported in SPLY.

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