Karachi: Dewan Sugar Mills Limited has released its unaudited interim financial results for the period ending March 31, 2025, revealing substantial losses across its operational segments. The Pakistani industrial sector, particularly agro-based industries, continues to grapple with efficiency and technological challenges, impacting the company's performance.
Dewan Sugar Mills reported net sales of Rs.1,197.92 million for the period, reflecting a decrease from the Rs.1,287.98 million recorded in the same period last year. The company faced a gross loss of Rs.541.07 million, a significant increase from the Rs.57.46 million gross loss reported in the previous year. The net loss after tax for the company amounted to Rs.590.95 million, compared to a loss of Rs.151.18 million in the previous period.
The sugar segment of the company resumed operations on January 22, 2025, after resolving technical and overhauling issues that had halted the 2023-24 crushing season. The company conducted sugarcane crushing for 24 days during the period under review and anticipates improved capacity utilization and results in the upcoming season.
In the distillery segment, Dewan Sugar Mills produced 2,509 tons of alcohol, a notable decrease from the 6,691 tons produced during the corresponding period last year. The segment suffered an operating loss of Rs.198.33 million compared to an operating profit of Rs.55.20 million previously. This downturn was attributed to underutilization of capacity amid global ethanol market dynamics and rising costs of production. In response, the company is implementing cost-cutting measures and developing a power project to enhance energy supply efficiency.
The chip board segment produced 39,660 sheets, up from 20,830 sheets in the last period, yet it reported an operating loss of Rs.4.51 million, slightly higher than the Rs.3.71 million loss in the previous year. Management is concentrating on producing high-quality, value-added products to reverse these losses. Meanwhile, the polypropylene unit remains inactive due to working capital constraints.
According to information available from the Pakistan Stock Exchange (PSX), the auditors have issued an adverse opinion on the company's going concern assumption, citing defaults in repayment of restructured liabilities and related non-provisioning of mark-up. The company is in discussions with lenders to restructure its liabilities, a process it hopes will soon be effective to ensure optimal production capacity utilization.
Dewan Sugar Mills emphasized its commitment to addressing these financial challenges and expressed hope for a successful restructuring that would stabilize its operations in the future.