Karachi: Ansari Sugar Mills Ltd has announced a substantial turnaround in its financial performance for the first quarter ending December 31, 2024, as stated in their Director's Report released on the same date. The company reported a notable increase in sales and profits compared to the corresponding period last year.
The company's financial statements reveal sales of PKR 756.31 million, a stark increase from PKR 59.60 million in the same quarter of 2023. The gross profit rose to PKR 244.52 million from PKR 2.50 million, while the pre-tax profit reached PKR 26.20 million, a significant improvement from the previous year's loss of PKR 285.63 million. The net profit after tax stood at PKR 59.60 million, compared to a net loss of PKR 229.20 million in the prior year.
The 2024-25 crushing season commenced on November 20, 2024. Notably, the government did not announce a support price for sugarcane for the season. Consequently, the mill procured sugarcane at prices ranging from PKR 425 to PKR 435 per 40 kg. Despite a shorter crushing season of 42 days compared to 50 days in 2023, the company produced 8,557 metric tons of sugar, a significant increase from 1,775 metric tons in the previous year. The sugar recovery rate improved to 8.7% from 8.5%.
According to information available from the Pakistan Stock Exchange (PSX), Ansari Sugar Mills faced challenges due to an inquiry by the Federal Investigation Agency (FIA), later transferred to the National Accountability Bureau (NAB), which resulted in the blocking of all company bank accounts. This action led to a liquidity crisis, affecting payments to banks, employees, and vendors. However, following amendments to the NAB Ordinance, the company's bank accounts were unfrozen, allowing it to resume normal operations.
In response to these challenges, the company has focused on diversifying its revenue streams and improving energy efficiency. Plans for Balancing, Modernization, and Replacement (BMR) have been set to enhance revenue through the sale of by-products such as bagasse and molasses. Additionally, Ansari Sugar Mills is working on long-term engagement with farmers to ensure a consistent sugarcane supply.
The company anticipates favorable conditions for the sugar industry, with expectations of bumper sugarcane production in the coming years. Ansari Sugar Mills is in advanced negotiations with bankers to restructure debts, aiming to improve its position on retained stocks and avoid forced sales, which would enable better pricing during the off-season.
The management is optimistic about a turnaround in the sugar industry and has mobilized resources to generate significant volumes in the ongoing and upcoming seasons over the next five years. The company expresses appreciation to its employees, clients, business partners, and shareholders for their support and confidence during challenging times.