LASM reports a 6% increase in six months net profit

November 1, 2021

Lasco Manufacturing Limited (LASM) for the six months ended September 30, 2021, recorded an increase of $533.89 million or 13% in revenue to total $4.66 billion relative to the $4.12 billion recorded for the comparable period in 2020. For the second quarter, total revenue closed at $2.34 billion (2020: $2.28 billion), a 3% rise yea over year.

Cost of sales amounted to $2.95 billion (2020: $2.52 billion) for the period, an increase of 17% year on year, due to rise in the cost for materials and logistics which were not fully recovered through selling price increased. As a result, gross profit of $1.71 billion was recorded for the period, 7% more than the $1.60 billion booked in September 2020. For the quarter, gross profit decrease by 1% to close at $869.54 million (2020: $880.51 million).

LASM posted other operating income of $50.97 million, compared to other operating loss of $18.18 million reported for the prior year. For the quarter, other operating income totaled $16.34 million in contrast to other operating losses of $15.85 million in the previous comparable quarter.

Operating expenses closed the period at $622.89 million compared to $667.84 million booked for the corresponding period last year. Operating expenses declined by 11% for the third quarter amounting to $318.63 million (2020: $356.91 million).

Consequently, LASM recorded operating profits of $1.14 billion, 24% higher than the $914.65 million booked in 2020. Operating profits rose 12% to close the second quarter at $567.25 million relative to $507.76 million in the prior comparable quarter.

Finance costs for the six months declined by 9% to $29.07 million compared to $31.83 million in the prior year’s comparable period. In the second quarter, finance costs declined 13% to $13.47 million (2020: $15.57 million).

As such, profit before taxation amounted to $1.11 billion, an improvement of 26% from the $882.82 million recorded for the previous year. Taxes recorded for the period amounted to $327.02 million (2020: $145.35 million). Thus, net profit for the six months period totalled $782.09 million compared to $737.47 million in 2020, an increase of 6% year over year. While, for the second quarter, net profit closed at $380.33 million (2020: $395.66 million), down by 4%.

Consequently, Earnings per share for the period ended September 30, 2021 amounted to $0.19 relative to $0.18 in 2020. For the quarter, Earnings per share totalled to $0.09 (2020: $0.10). The trailing twelve months EPS amounts to $0.35. The number of shares used in the calculations amounted to 4,132,913,151 units. The stock price closed trading on October 29, 2021 at $4.71 with a corresponding P/E of 13.67 times.

Balance sheet at a Glance:

Total assets increased 10% year on year, totalling $11.14 billion as at September 30, 2021 (2020: $10.11 billion). The increase in total assets was mainly due to a 33% increase in ‘Trade and Other Receivables’ to total $2.98 billion (2020: $2.24 billion). ‘Property, Plant & Equipment’ and ‘Short-term Investment’ also contributed to the growth closing at $4.70 billion (2020: $4.51 billion) and $369.42 million (2020: 214.23 million), respectively.

Total shareholders’ equity amounted to $8.39 billion as at September 30, 2021 (2020: $7.24 billion). Consequently, book value per share amounted to $2.03 relative to $1.75 in 2020.


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