Pioneer Cement Ltd posted a profit after tax (PAT) of PKR1.75bn (US$6.26m) in the 2QY24-25, which represents a 71 per cent increase compared to the previous quarter, although it remained flat YoY. This brings the total PAT tax for the 1HFY24-25 to PKR2.77bn, a six per cent rise compared to last year. These results were announced on the Pakistan Stock Exchange last week, indicating that a decrease in interest rates has contributed to the increase in profits.
According to IMS Research, PIOC's net sales amounted to PKR8.9bn in the 2QY24-25, representing a 13 per cent increase QoQ but a 12 per cent decrease YoY, which aligns with market expectations. A 20 per cent increase drove the sequential improvement in sales, although this was somewhat offset by weaker cement prices, which fell by four per cent compared to the previous quarter.
Gross margins increased to 42 per cent in the 2QY24-25, up 11 percentage points from the previous quarter, significantly surpassing market expectation of 32 per cent. This discrepancy is likely due to lower coal procurement costs. However, analysts await detailed financials for further clarification. Finance costs decreased by 30 per cent compared to the previous quarter, totalling PKR347m, consistent with research house projections. This decline occurred despite a 41 per cent increase in total debt compared to the prior quarter.
PIOC has delivered strong profitability, driven by an efficient fuel and power mix and a disciplined focus on high-retention markets.
by Abdul Rab Siddiqi, Pakistan
