AGP Limited (AGP) Q1 earnings preview
TSL Research has just released an update on AGP’s previous quarter’s financial results. Here are the important points from their 1QCY24 earnings preview.
Strong Growth in Profitability
AGP is expected to report an EPS of PKR 2.25 and a Profit After Tax (PAT) of approximately PKR 739 million for 1QCY24, marking an impressive increase of around 77% over the same period last year.
Revenue Analysis
The company’s revenue is projected to reach around PKR 3.9 billion for 1QCY24. This growth is attributed to a price increase of 14% and 20% for essential and non-essential medicines, respectively. Additionally, AGP is anticipated to receive marginal support from exports, with a notable 20%QoQ growth in 1QCY24.
Gross Margin Expectations
Despite strong revenue growth, gross margins are expected to decline to 53.2% for 1QCY24, down 4 percentage points QoQ due to increased energy prices.
Future Outlook
AGP is expected to benefit from the pending deregulation of non-essential medicines and the Government’s decision to increase prices of 146 essential medicines. Given its current revenue mix of 40% essential and 60% non-essential medicines, the company is well-positioned for future growth.
Dividend Expectations
No interim cash dividend announcement is anticipated for the quarter.
| PKR Mn | 1QCY23A | 1QCY24E | YoY | 4QCY23A | QoQ |
|---|---|---|---|---|---|
| Revenue | 3,899 | 6,407 | 64% | 5,804 | 10% |
| Cost of sales | 1,863 | 2,996 | 61% | 2,479 | 21% |
| Gross profit | 2,036 | 3,411 | 68% | 3,325 | 3% |
| Selling, admin & marketing expenses | 1,253 | 1,932 | 54% | 1,707 | 13% |
| Other expenses/(income) – net | 123 | 31 | -75% | 10 | 2.0x |
| Finance costs | 143 | 378 | 1.6x | 647 | -42% |
| Profit before tax | 517 | 1,071 | 1.1x | 960 | 12% |
| Taxation | 122 | 332 | 1.7x | 264 | 26% |
| Profit after tax | 396 | 739 | 87% | 695 | 6% |
| Profit attributable to Parent Co. | 356 | 629 | 77% | 592 | 6% |
| EPS – Consolidated | 1.27 | 2.25 | – | 2.12 | – |
| DPS | – | – | – | 2.00 | – |
These numbers provide insights into AGP’s anticipated financial performance for the first quarter of CY24, reflecting strong growth in revenue and profitability.
Disclaimer:
The information in this article is based on research by TSL Research & Company Reports. All efforts have been made to ensure the data represented in this article is as per the research report. This report should not be considered investment advice. Readers are encouraged to consult a qualified financial advisor before making any investment decisions.
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