Attock Cement posts positive 9MFY16 results

Attock Cement Pakistan Ltd (ACPL) has announced in its 9MFY16 results it earned a NET profit of PKR2.094bn during 9MFY16 (July-March) against PKR1.644bn during 9MFY15, up 27 per cent, YoY, on the back of a five per cent YoY growth in net sales and better gross profits.
 
Al Habib Capital Markets (Pvt) Ltd, in its review report about ACPL, attributes increase in profit to rising domestic dispatches, on the back of acceleration in private sector construction activities, commencement of work on mega projects in the north, partial materialisation of budgeted Public Sector Development Programme (PSDP) and improvement in economic and law and order situations.
 
However, ACPL export performance was impacted due to drop in export dispatches, which fell by 29 per cent YoY during 9MFY16 due to the imposition of anti‐dumping duty in South Africa on Pakistan’s cement manufacturers as well as the devaluation of the currencies of most African and Asian countries, due to the depreciation of the Chinese yuan against the US dollar. But luckily exports were mitigated partially by the addition of new export markets like India, Yemen and Somalia.
 
The company's growth profit margins remained strong in 9MFY16, rising 39 per cent against 9MFY15 growth profit margin of 32 per cent. This was attributable to the fall in international coal prices amid weaker global demand resulting in lower fuel costs, a reduction in power cost due to lowering of electricity charges on the back of fuel price adjustments following declining oil prices (3QFY16 reduction in power tariffs by PKR3.50/unit), and the major overhaul and upgrade to one of its cement mills and the installation of variable-frequency drives on its key motors to cut power costs.