Karachi: Siddiqsons Tinplate Limited, Pakistan's only producer of tinplate, faced a significant 16% drop in revenue and a 40% decline in capacity utilization in the recent fiscal period, as reported on March 24, 2023. The company's net sales fell to Rs. 3.03 billion from Rs. 3.63 billion in the previous year.

According to information available from the Pakistan Stock Exchange (PSX), Siddiqsons Tinplate has been grappling with several operational difficulties, including the increased usage of alternative materials like Galvalume, despite health concerns associated with its use in food packaging. This shift has heavily impacted the company's production capacity and financial performance.

The decrease in revenue is further exacerbated by non-capitalized finance costs related to the TMBP project. This financial strain has translated into a dramatic 255% fall in the company's profitability before tax, recording a loss of Rs. 173.86 million compared to a profit of Rs. 112.39 million in the previous year. Earnings per share also reflected this downturn, moving from Rs. 0.49 to a loss of Rs. 0.76.

Operational data reveals a sharp 23% reduction in the quantity of tinplate sold, down to 9,152 tons from 11,856 tons year-over-year. Additionally, the company's earnings before interest, taxes, depreciation, and amortization (EBITDA) plummeted by 51%, highlighting the financial pressures faced.

In response to these challenges, Siddiqsons Tinplate is implementing several strategic measures to bolster its financial health and operational efficiency. These include reducing excess manpower, enhancing material usage efficiency, and shifting production schedules to off-peak electricity hours to cut costs. Furthermore, the company is exploring export opportunities to improve capacity utilization and counter the domestic market's contraction.