Globe Residency REIT, managed by Arif Habib Dolmen REIT Management Limited, released its financial results for the quarter ending on September 30, 2024. The REIT’s performance was evaluated and approved by its Board of Directors at a meeting held on October 29, 2024. Here’s a detailed breakdown of the key metrics, figures, and announcements from this quarter’s financial report.
Key Announcements
The Board of Directors declared no cash dividends, bonus shares, right shares, or any other entitlements or price-sensitive information. These decisions reflect the company’s financial approach for the quarter, likely aiming to preserve capital and manage resources efficiently.
Financial Highlights
Revenue and Gross Profit
- Revenue: The REIT generated PKR 492,632,000 in revenue from contracts with customers in Q3 2024, down from PKR 616,683,000 in the same period of 2023. This decrease in revenue indicates a 20% drop, likely impacted by market conditions or project timings.
- Cost of Sales: The cost of sales stood at PKR 398,171,000 in Q3 2024, also lower than the PKR 504,878,000 incurred in Q3 2023. This reduction in costs helped mitigate the impact of the revenue decline.
- Gross Profit: With the reduction in both revenue and cost of sales, gross profit for the quarter amounted to PKR 94,461,000, compared to PKR 111,805,000 in Q3 2023. Despite the decrease, gross profit margin was relatively stable, showing resilience in the company’s operational management.
Operating Expenses and Net Operating Income
- Administrative and Operating Expenses: The administrative and operating expenses rose significantly to PKR 23,665,000 in Q3 2024 from PKR 7,596,000 in Q3 2023. This increase in operational expenses resulted in a reduced net operating income.
- Net Operating Income: The net operating income dropped to PKR 70,796,000 in Q3 2024 from PKR 104,209,000 in Q3 2023. This reflects the impact of increased administrative expenses on the company’s operating performance.
Other Income and Profit Before Tax
- Other Income: The company recorded other income of PKR 13,715,000 in Q3 2024, a substantial increase from PKR 7,832,000 in Q3 2023. This additional income played a role in boosting the REIT’s overall profit.
- Profit Before Taxation: Before taxation, the profit was PKR 73,416,000 in Q3 2024, a decrease from PKR 100,403,000 in Q3 2023. This decrease is consistent with the lower revenue and higher administrative expenses observed during the period.
Profit After Tax and Earnings Per Unit
- Taxation: Taxation for Q3 2024 was minimal at PKR 749,000, compared to PKR 29,325,000 in Q3 2023. This reduced tax expense contributed positively to the net profit.
- Net Profit: The net profit after tax stood at PKR 72,667,000 in Q3 2024, marginally higher than PKR 71,078,000 in the previous year’s quarter, despite reduced revenue and higher expenses.
- Earnings Per Unit: The earnings per unit (basic and diluted) were PKR 0.52 in Q3 2024, a slight increase from PKR 0.51 in Q3 2023, indicating that the REIT’s performance per unit has remained stable.
Breakdown of Major Expenses
The financial statement highlighted specific expenses that impact Globe Residency REIT’s profitability, including:
- Remuneration to the REIT Management Company: This remained consistent at PKR 7,058,000 for both Q3 2024 and Q3 2023.
- Sindh Sales Tax on REIT Management Remuneration: Sales tax was PKR 1,059,000 in Q3 2024, compared to PKR 917,000 last year.
- Remuneration of the Central Depository Company: As trustee, this cost was PKR 1,412,000 in both Q3 2024 and Q3 2023.
- Annual SEC Fee: Paid to the Securities and Exchange Commission of Pakistan, this fee was PKR 1,327,000 in Q3 2024, slightly lower than PKR 1,412,000 in Q3 2023.
Summary
Globe Residency REIT’s financial performance in Q3 2024 reflects a challenging environment with a decline in revenue and an increase in administrative costs. However, the REIT has managed to sustain its profitability per unit, underscoring its operational resilience.