Lahore: Kohinoor Mills Limited, one of Pakistan's leading textile manufacturers, announced a notable decline in its profitability for the fiscal year 2023-24 during its Corporate Briefing Session. Despite an increase in sales, the company reported a net loss, contrasting with a profit in the previous year.
According to the financial results released, Kohinoor Mills' sales for the fiscal year 2023-24 amounted to 29,854.24 million rupees, up from 28,208.45 million rupees in 2022-23. The cost of goods sold also rose to 25,608.31 million rupees from 22,341.28 million rupees, resulting in a gross profit of 4,245.94 million rupees, down from the previous year's 5,867.16 million rupees. The gross profit margin decreased to 14.22% from 20.80%.
Operating expenses, including administrative and selling expenses, stood at 2,380.97 million rupees, slightly lower than the previous year's 2,403.78 million rupees. The company reported an operating profit of 1,864.97 million rupees, a significant decrease from 3,463.39 million rupees in 2022-23. Other income increased to 282.20 million rupees from 236.02 million rupees, resulting in a total operating income of 2,147.17 million rupees, compared to 3,699.41 million rupees the previous year.
Financial charges surged to 1,718.89 million rupees from 1,249.47 million rupees, contributing to a steep decline in profit before taxation, which fell to 428.29 million rupees from 2,449.93 million rupees in 2022-23. After accounting for a tax provision of 447.91 million rupees, the company reported a net loss of 19.62 million rupees, a stark contrast to the net profit of 2,001.51 million rupees recorded in the previous fiscal year. The net profit margin turned negative at -0.07%, down from 7.10%.
According to information available from the Pakistan Stock Exchange (PSX), Kohinoor Mills' financial performance reflects the challenges faced by the textile sector, including rising costs and financial charges. The company did not provide specific details on strategies to address these challenges during the briefing.