Ghandhara Nissan profits improved

Ghandhara Nissan profits improved

Ghandhara Nissan profits improved

9/29/2011 2:56:45 PM

KARACHI: Ghandhara Nissan Limited (GHNL) recorded profits of Rs 7.097 million in the financial year 2011 (FY11) after huge losses of Rs 88.893 million in the previous year, said in a notice issued by the company to Karachi Stock exchange.

Healthy results are mainly due to increase in company's net revenues which have surged by 10.30 percent year on year (YoY) to Rs 2,650.068 million as against Rs 2,404.617 million in the corresponding year.

Earnings per share of the company also turned up to Rs 0.16 per share during 2011 as against negative EPS of Rs 1.98 in the previous year.

The company's board of management in their meeting held on Thursday, September 29, 2011 announced financial results for the year ended June 30, 2011.

The company's cost of sales for the year went up by 5.02 percent YoY to Rs 2,397.795 million while company's gross profits surged by 111.32 percent YoY to Rs 252.273 million during the period as compared to Rs 119.379 million in the FY10.

Financials show 4.82 percent YoY increase in administrative expenses; therefore, it reached to Rs 111.432 million. GHNL's distribution cost upped by 3.55 percent YoY to Rs 30.865 million. The finance cost jumped by 19.45 percent YoY to Rs 175.977 million in 2011 as against Rs 147.328 million in the last year.

Other operating income of the company outshined during the period as it gained 194.41 percent YoY to Rs 41.938 million. However, GHNL's share of profit of associated company declined during the period by 67.03 percent YoY to Rs 8.570 million.

Recent measures to bring competition in local auto industry through relaxation granted to imports would pose challenge to local auto manufacturers. Floods in rural Sindh and declining rural income prospects resultantly and the added factor of lower cotton prices this year will have negative impact on purchasing power of masses.

Relaxation in General Sales Tax (GST) by 1 percent and abolition of Special Excise Duty (SED) were some of the measures that could help the local auto manufacturers.

But, the recent change in rupee dollar parity which has resulted in rupee depreciating by at least 10 percent against dollar in a matter of few days would put upward pressure on input costs and will depress margins.

Ghandhara Nissan Limited (GNL) is a private limited company acquired the license for the distribution of Nissan vehicles in CBU condition in Pakistan; later in 1992 it was converted in to a Public Company listed in Karachi Stock Exchange. It is the only Automobile Company in the country assembling complete range of product i.e. passengers cars, light commercial vehicles and heavy-duty trucks and buses.