Indus Motors Company Limited (PSX: INDU) disclosed its financial results for the first half of fiscal year 2024 today, reporting a profit after tax of Rs. 4.95 billion, marking an 89 percent year-on-year increase.
In the second quarter of fiscal year 2024, the company’s profitability stood at Rs. 1.74 billion, compared to Rs. 1.33 billion in the same period last year, reflecting a 31 percent year-on-year growth.
Alongside the results, the company announced a cash dividend of Rs. 13.2 per share (Rs. 37.70 per share in the first half of fiscal year 2024).
Net sales during the first half of fiscal year 2024 amounted to Rs. 50.910 billion, a decrease of 41 percent year-on-year from Rs. 86.8 billion in the corresponding period. In the second quarter of fiscal year 2024, net sales witnessed a 63 percent year-on-year decline and a 44 percent quarter-on-quarter decrease. This decline was primarily attributed to lower volumetric sales (-72 percent year-on-year), with significant reductions observed in the sales of Fortuner and Hilux (-83 percent year-on-year), according to Arif Habib Limited.
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The gross margin for the first half of fiscal year 2024 was reported at 9.3 percent, contrasting with -3.3 percent in the same period last year, mainly due to a stable PKR/USD exchange rate and a decrease in raw material costs, particularly steel. On a quarterly basis, the gross margins settled at 7.8 percent during the second quarter of fiscal year 2024, compared to -1.0 percent in the same quarter last year, driven by the aforementioned factors.
Distribution expenses rose by 94 percent year-on-year, reaching 654 million during the second quarter of fiscal year 2024, attributed to increased marketing expenses associated with the Corolla Cross.
Other income declined by 28 percent year-on-year to PKR 2,494 million in the second quarter of fiscal year 2024, primarily due to a decrease in short-term investments, resulting in lower interest income.
The company recorded an effective taxation rate of 28 percent in the second quarter of fiscal year 2024, compared to 31 percent in the same period last year.
The company’s board has approved an investment of Rs. 3 billion to enhance the localization of parts and components of Completely Knocked Down (CKD) units assembled by the company. Additionally, the company aims to complete the investment by the third quarter of calendar year 2025.