The financial results for Sazgar Engineering Works Limited for the year ended June 30, 2024, highlight a strong financial performance and strategic expansion plans for future growth. Below is a comprehensive overview of the company’s financial achievements and the significant announcements made.
Financial Performance
For the fiscal year 2024, Sazgar Engineering Works Limited reported a significant increase in its revenues and profitability:
- Net Sales: The company achieved net sales of PKR 57.64 billion in 2024, a major leap from the previous year’s PKR 18.17 billion. This indicates a robust growth in sales across its product lines.
- Gross Profit: The gross profit soared to PKR 15.65 billion, compared to PKR 2.55 billion in 2023. This sharp increase in profitability reflects effective cost management and improved market demand for the company’s offerings.
- Operating Profit: The operating profit for 2024 stood at PKR 13.45 billion, a significant jump from PKR 1.72 billion in 2023, showcasing the company’s strong operational performance.
- Net Profit: After accounting for financial costs, taxes, and other operating expenses, the company reported a net profit of PKR 7.94 billion, a massive growth from the previous year’s PKR 995.68 million.
- Earnings per Share (EPS): The EPS for the year 2024 was reported at PKR 131.29, compared to PKR 16.46 in 2023, underscoring a remarkable improvement in shareholder returns.
Key Decisions by the Board of Directors
The Board of Directors made two key announcements during their meeting on September 23, 2024:
- Final Cash Dividend: The Board recommended a final cash dividend of PKR 12 per ordinary share for the year ended June 30, 2024. This dividend amounts to 120% of the current paid-up share capital. Shareholders had already received an interim cash dividend of PKR 8 per share earlier in the year, making the total dividend payout for 2024 PKR 20 per share. This recommendation is subject to approval at the 33rd Annual General Meeting of the company.
- Expansion in Four-Wheeler Manufacturing Facilities: The company has approved an ambitious expansion plan to enhance its four-wheeler manufacturing capabilities. This expansion includes:
- Upgrading the existing paint shop,
- Building new warehousing facilities,
- Installing a solar system of 4-megawatt capacity,
- Establishing new manufacturing facilities for the local assembly of New Energy Vehicles (NEVs).
The estimated cost for this expansion is PKR 4.5 billion, which will be funded through the company’s internal cash resources. The expansion will play a crucial role in positioning Sazgar Engineering Works Limited as a leader in the NEV segment, with plans to roll out CKD (Completely Knocked Down) models by the end of December 2025.
Strategic Outlook
Sazgar Engineering Works Limited is clearly on a trajectory of sustained growth. The expansion into NEVs and the planned facilities upgrades demonstrate the company’s commitment to innovation and meeting future demands in the automotive industry. The strong financial performance in 2024, coupled with strategic initiatives, reflects a positive outlook for the company’s future growth and shareholder value.
With a focus on cleaner, energy-efficient vehicles, the company is well-positioned to capitalize on global trends towards sustainability and electric vehicles, making it a significant player in the evolving automotive landscape in Pakistan and beyond.
Source: PSX