KARACHI: Dewan Mushtaq Textile Mills Limited has reported a significant deterioration in its financial performance, posting a loss after taxation of Rs19.38 million for the half year ended December 31, 2024, compared with a loss of Rs11.98 million in the corresponding period last year.
According to the financial results submitted to the Pakistan Stock Exchange, the company recorded no sales revenue during the six-month period. However, it incurred a cost of sales of approximately Rs14.49 million, resulting in an equivalent gross loss.
The company’s administrative and general expenses also increased to Rs5.96 million, compared with Rs4.49 million in the same period of the previous year. As a result, the operating loss widened to Rs20.45 million, against an operating loss of Rs19.97 million previously.
Dewan Mushtaq Textile Mills reported only Rs32,000 in finance costs during the period, while other income stood at nil. In comparison, the company had recorded other income of approximately Rs6.78 million during the corresponding period last year. This absence of other income contributed to the higher overall loss.
The company’s loss per share increased to Rs1.68, compared with Rs1.04 per share in the same period of 2023.
Quarterly performance also remains under pressure
For the quarter ended December 31, 2024, the company posted a loss after taxation of Rs11.06 million, compared with a loss of Rs8.80 million in the same quarter last year.
Quarterly loss per share stood at Rs0.96, compared with Rs0.76 in the corresponding quarter of the previous year.
Financial position
The company’s total assets stood at approximately Rs802.31 million as of December 31, 2024, down from Rs822.53 million at June 30, 2024.
Accumulated losses increased to approximately Rs735.66 million, compared with Rs718.90 million at the end of June 2024. The balance sheet also showed substantial current liabilities, including short-term borrowings of around Rs232.20 million and mark-up accrued on loans of approximately Rs136.90 million.
Cash and bank balances stood at only around Rs3.48 million at the reporting date.
Auditor highlights going-concern concerns
A significant concern highlighted in the financial statement relates to the company’s going-concern position. According to the filing, the auditors expressed an adverse opinion in their review report on the going-concern assumption, citing the closure of operations, default in repayment of instalments of restructured liabilities and related non-provisioning of mark-up.
The company also reported no cash dividend, bonus shares, right shares or other corporate action for the period.
The financial figures and disclosures are contained in the company’s half-yearly unaudited condensed interim financial statements submitted to the Pakistan Stock Exchange.
The results indicate that Dewan Mushtaq Textile Mills continues to face considerable financial pressure, with the absence of sales, rising accumulated losses and concerns over its ability to continue as a going concern remaining key issues for stakeholders.
