The Board of Directors of Sapphire Fibres Limited convened on September 27, 2024, to approve the financial results for the fiscal year ended June 30, 2024. The meeting, held at the company’s head office in Lahore and accessible via video conferencing, resulted in several key financial decisions that signal ongoing efforts for growth, expansion, and value enhancement for shareholders.
Final Cash Dividend Announcement
Sapphire Fibres Limited declared a final cash dividend for the fiscal year 2023-2024, amounting to PKR 10 per share, equivalent to 100% of the company’s face value shares. This dividend payout demonstrates the company’s commitment to sharing its profits with its shareholders despite challenging market conditions.
Strategic Expansion and Investment
The Board acknowledged the company’s sustained expansion and diversification efforts, which have resulted in significant long-term investments aimed at enhancing enterprise value for shareholders. These initiatives reflect the company’s focus on broadening its operational footprint and increasing profitability in the future.
Reclassification of Reserves
Due to significant investments made in capacity expansion and long-term strategic objectives, the Board observed that a considerable portion of general reserves and unappropriated profits had been utilized and were no longer available for distribution as dividends. To ensure transparency and better reflect the nature of these reserves, the Board approved the reclassification of PKR 27.50 billion from revenue reserves to capital reserves. This move will support future growth initiatives while preserving the company’s financial flexibility.
Financial Performance for FY2024
For the year ended June 30, 2024, Sapphire Fibres Limited reported sales of PKR 47.42 billion, a marginal increase compared to PKR 46.44 billion in FY2023. Despite this, gross profit declined from PKR 8.92 billion in FY2023 to PKR 5.66 billion, driven by an increase in the cost of sales, which amounted to PKR 41.75 billion compared to PKR 37.53 billion in the previous year.
Operating profit for the year also saw a decline, with PKR 6.99 billion reported for FY2024, down from PKR 8.08 billion in FY2023. The decline is attributed to higher distribution and administrative costs, as well as increased finance costs, which rose from PKR 1.98 billion to PKR 2.78 billion in FY2024.
Profitability and Earnings Per Share (EPS)
The company’s profit before taxation stood at PKR 2.99 billion, compared to PKR 5.21 billion in the previous year. Net profit for FY2024 was PKR 3.37 billion, a significant decrease from PKR 5.12 billion in FY2023. Earnings per share (EPS) also dropped from PKR 247.72 to PKR 163.17.
This downward trend in profitability reflects rising operational costs and challenges in the broader economic environment. However, the company’s leadership remains confident that strategic investments and a robust diversification strategy will foster long-term shareholder value.