Karachi: A Karachi-based company has reported a mixed set of financial results for the year ending June 30, 2023. Despite an increase in sales revenue by 17.14% and turnover quantity by 13.62%, the company observed a decline in profitability with its gross profit rising by 18.20%, representing a modest improvement in the gross profit percentage of revenue from the previous year.

Operating profit showed a substantial increase of 22.76%, but this was offset by a significant hike in financial expenses, which soared by 224.77%. Consequently, profit before tax decreased by 6.45%, and profit after tax saw a steep drop of 31.15%, leading to a reduction in earnings per share from PKR 1.42 in the previous year to PKR 0.97.

The company cited multiple factors for the downturn in profits, including adverse exchange rates, increased raw material costs not fully passed on to customers, a significant rise in power costs, higher interest expenses, and the impact of deferred taxation.

On a positive note, equity improved by 5.21% over the year, and net working capital surged by 29.36%. The company highlighted several operational improvements, including the commencement of a yarn-making machinery, rationalization of the plant, and promising sales in fishing nets and other products.

Despite these optimistic developments, the market remains volatile, and the company's reduced net profit, coupled with an expected increase in cash flow requirements and limited liquidity, has led to the decision to withhold dividends for the current year.