Karachi: Ansari Sugar Mills Limited has released its financial statements for the first quarter ending December 31, 2023, indicating a challenging financial landscape despite a notable increase in production. The company's sales for this period stood at 59.60 million PKR, a decline from the previous year's figure of 77.69 million PKR. The gross profit for the quarter was reported at 2.50 million PKR, a significant improvement from a loss of 3.76 million PKR in the corresponding period last year. However, the pre-tax loss widened to 285.63 million PKR from 210.97 million PKR in the previous year.
The company commenced its sugarcane crushing operations for the 2023-24 season on November 12, 2023. The season's duration extended to 50 days, compared to 35 days in the previous year, resulting in the production of 1,775 metric tons of sugar, up from 1,528.5 metric tons in the prior season. Sugar recovery rates slightly decreased to 8.50% from 8.49%, while molasses production increased to 995 metric tons, with a recovery rate of 4.535%.
According to information available from the Pakistan Stock Exchange (PSX), Ansari Sugar Mills posted a net loss after tax of 229.21 million PKR, compared to a net loss of 168.51 million PKR during the same period last year. The company has faced significant financial hurdles, primarily due to an ongoing investigation by the Federal Investigation Agency (FIA) and the National Accountability Bureau (NAB), which led to the freezing of its bank accounts.
The company's access to funds and banking facilities was restricted, causing defaults on various financial obligations, including payments to banks, employees, and suppliers. However, following amendments to the NAB Ordinance, Ansari Sugar Mills' accounts have been unfrozen, allowing the company to negotiate debt restructuring with its bankers to improve its financial position.
Despite these challenges, Ansari Sugar Mills is optimistic about its future prospects. The company plans to diversify its revenue streams by enhancing energy efficiency and modernizing its operations. It also aims to engage with farmers to increase sugarcane cultivation and ensure a stable supply of the raw material.
The provincial government has set the price of sugarcane at 425 PKR per 40 kg for the 2023-24 season, a factor that could impact the company's financial performance. Ansari Sugar Mills anticipates a turnaround in the sugar industry and is mobilizing resources to generate increased production volumes over the next five years.
The company is also hopeful that federal government policies will support the sugar industry by regulating export permissions, potentially allowing for an export surplus of sugar and ethanol. This, in turn, could stabilize the local market and improve profitability.
As Ansari Sugar Mills navigates these challenges, it remains committed to its employees, clients, business partners, and shareholders, expressing gratitude for their continued support and confidence.