Lucky Cement Limited (LUCK) announces Q3 financial results

AKD Research has just released an update on Lucky Cement Limited’s recent quarterly results. Here are the important points from the earnings announcement:

Quarterly Earnings Overview

Lucky Cement Limited (LUCK) has disclosed its financial results for the third quarter of the fiscal year 2024 (3QFY24). The company reported unconsolidated earnings of PkR4.9 billion, translating to an EPS (earnings per share) of PkR16.9. This represents a decline from the previous quarter’s earnings of PkR6.8 billion (EPS: PkR23.1), marking a 27% quarter-on-quarter (QoQ) decrease in profitability.

Key Highlights

Revenue Decline

The company’s total revenue, also known as the topline, stood at PkR27.5 billion for the quarter, down by 10% compared to the previous quarter. This decrease was mainly driven by a 10% QoQ decline in sales volumes during the period.

Gross Margin Contraction

Lucky Cement witnessed a contraction in gross margins, which decreased by 7.2 percentage points to 28.8% from 36.0% in the previous quarter. The decline in margins can be attributed to higher coal prices, increased power costs due to upward adjustments in gas prices, and a higher proportion of clinker exports in the sales mix.

Other Income

The company’s other income for the quarter was PkR2.9 million, reflecting a 6% QoQ decrease but an 84% year-on-year (YoY) increase. This rise in annual income is primarily due to higher interest rates and increased dividends from LCI (PkR1.4 billion compared to PkR0.5 billion in the same period last year).

Year-to-Date Performance

For the first nine months of the fiscal year 2024 (9MFY24), Lucky Cement’s unconsolidated earnings accumulated to PkR63.6 per share compared to PkR38.0 per share in the same period last year, marking a substantial increase of 67% YoY. This growth was driven by elevated gross margins and increased other income (up by 106% YoY).

Consolidated Earnings

On a consolidated basis, earnings for 3QFY24 amounted to PkR53.2 per share, down by 12% YoY. The decline can be attributed to lower earnings from core cement operations and potentially from foreign operations due to the appreciation of the domestic currency.

PKR (mn)	3QFY24	2QFY24	QoQ	3QFY23	YoY	9MFY24	9MFY23	YoY
Sales	27,523	30,499	-10%	25,015	10%	87,404	70,348	24%
COGS	19,591	19,509	0%	18,543	6%	57,651	51,354	12%
Gross Profit	7,932	10,990	-28%	6,471	23%	29,752	18,994	57%
Gross Margins	28.8%	36.0%	–	25.9%	–	34.0%	27.0%	–
Opex	2,446	2,543	-4%	1,714	43%	7,212	5,287	36%
Other Income	2,869	3,045	-6%	1,558	84%	9,064	4,406	106%
Finance Cost	389	424	-8%	185	110%	1,195	798	50%
NPAT	4,938	6,781	-27%	4,005	23%	18,649	11,133	67%
EPS (PkR)	16.9	23.1	–	13.7	–	63.6	38.0	–
EPS (PkR) Consol	53.2	60.2	-12%	71.8	-26%	173.8	126.1	38%
DPS (PkR)	–	–	–	–	–	–	–	–

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Disclaimer:

The information in this article is based on research by AKD Research. 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.