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Corporate results: Atlas Honda records 22% profit growth



Corporate results: Atlas Honda records 22% profit growth

By Our Correspondent
Published: October 31, 2013
Earnings per share of the company improved to Rs9.22 against Rs7.55 in the previous year. PHOTO: FILE
KARACHI: Atlas Honda – the largest motorcycle producer in Pakistan – has announced an earnings growth of 22% to Rs953 million in the first half (April-September) of fiscal year 2013-14 against Rs781 million in the corresponding period of previous year.
Earnings per share of the company improved to Rs9.22 against Rs7.55 in the previous year.
The growth in the bottom line (profit) came as a result of increase in the top line (revenues), slightly improved other income and decline in financial charges. However, the growth in earnings was restricted by an increase in cost of sales and operating cost of the company, Summit Capital said in a report on Wednesday.
Sales rose 4% year-on-year to Rs21.49 billion against Rs20.72 billion in the first half of 2012-13.
A rise in cost-push inflation, especially after the recent hike in fuel and electricity prices, coupled with a decline in rupee against the US dollar would hit primary margins of the company, the research house said.
As a result, cost of production is expected to rise sharply because of costly imports, the report said, adding rising inflation and a tight monetary policy were going to hurt consumer sentiments.
However, since the company has the largest production capacity and a strong dealers’ network, it would still be able to operate successfully in a challenging environment in the near future.
The company witnessed an increase of 6% in its operating cost to Rs943 million compared to Rs887 million last year.
Other income edged up to Rs165 million while financial charges dropped to Rs4 million.
Published in The Express Tribune, October 31st, 2013.

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