Higher volumetric sales and lower coal prices helped Maple Leaf Cement (MLCF) beat market expectations as the company improved its profits by over one-fifth to Rs3.5 billion during the financial year that ended on June 30, 2015.
Based on an official notification sent to the Karachi Stock Exchange on Wednesday, the organization posted an after tax gain of Rs3.5 billion or Rs6.5 per share in fiscal year (FY) 2015. This translates to a 22% increase compared with Rs2.8 billion or Rs5.4 per share it earned in FY 2014.
The effect was above market expectations as a Taurus Securities report forecast net earnings of Rs6.2 per share, which translates to a 16% year-on-year increase.
However, the stock, which traded at Rs68.69 per share the preceding day, dropped by 0.8% or Rs0.6 per share to settle at Rs68.14 per share on profit booking by investors. A total of 5.5 million shares changed hands on Wednesday, less than half when compared to Tuesday’s 13 million.
The development in earnings was a variable of volumetric growth due to expansion and higher dispatches BMA Capital said in a report. Monetary easing and deleveraging helped facilitate its financing cost, which clocked in at Rs1 billion, down 26% from Rs1.5 billion of the prior year, making favorable effect on net gains, it added.
A subsidiary company of Kohinoor Maple Leaf Group, Maple Leaf Cement grossed Rs20.7 billion in revenues through the year under review, up 9.2% compared to Rs18.9 billion of FY2014. Kohinoor Maple Leaf Group is a division of Saigol Group of Companies.
Together with the results, the company also announced its plan to invest Rs5 billion in Maple Leaf Power Limited for setting up a 40 Megawatt coal-fired power plant.