Millat Tractors post profit of Rs10.6bn in FY24, up 167%

Millat Tractors Limited (MTL), Pakistan’s largest tractor manufacturer, reported a profit-after-tax (PAT) of Rs10.64 billion for the financial year ended June 30, 2024, a jump of nearly 167% year-on-year.

The company registered consolidated earnings of Rs4 billion in 2023, showed MTL’s latest financial results provided to the Pakistan Stock Exchange (PSX) on Monday.

The board of directors met on September 9 to review the company’s financial and operational performance.

The company informed that the Board of Directors and shareholders of the Company earlier approved the scheme for merger of Millat Tractors Limited with Millat Equipment Limited (MEL). However, the approval of the scheme of arrangement by the Lahore High Court, Lahore (LHC) is still pending.

“According to the terms of the scheme, MTL is not permitted to pay any dividends until the LHC grants approval of the merger,” it said.

Therefore, for the financial year ended June 30, 2024, the total cash dividend will be limited to the interim dividend of Rs25 per share (250%) which has already been paid. However, the BoD may consider approval of dividend subsequent to the merger of two companies.

Meanwhile, earnings per share (EPS) were recorded at Rs55.46 in FY2024 as compared to EPS of Rs18.53 in SPLY.

Millat Tractors warns of shutdown amid GST dispute and plummeting sales

The growth comes on the back of a massive increase in sales and lower finance cost paid during the period.

MTL’s revenue from contracts with customers rose to Rs95.02 billion compared to Rs47.14 billion in SPLY, which is up by over 101%.

“This growth was fueled by a 62% YoY surge in volumetric sales, reaching 30.2k units,” said Arif Habib Limited (AHL) in a note.

The company’s gross profit registered a growth of 130%, clocking in at Rs23.97 billion in FY24, compared to Rs10.40 billion in FY23.

Resultantly, the company’s profit margin improved to 25.2% in FY24, as compared to 22.1% in the preceding year

During the period, MTL’s operating cost stood at Rs5.36 billion in FY24, a jump of 63%, as compared to Rs3.28 billion in FY23.

However, its cost of finance decreased to Rs1.38 billion in the FY24, as compared to Rs1.65 billion in the same period last year, a decline of 16%.

MTL’s profit before tax clocked in at Rs17.99 billion in FY24, a yearly increase of 210%.

Last month, MTL ceased production, pinning it on the government that had failed to issue a mechanism for payment of refund claims.