In its Annual Report 2005 the company has posted accounts for last year's nine months ended June 30, 2005 (9M 2004-05) and in the quarterly unaudited accounts ended March 31 2006 the company has posted financials for the nine months of current year (9M 2005-06).
Last year, for 9M 2004-05 the company had generated sales at Rs 3.123 billion which works out to the annualised sales estimate of Rs 4.164 billion which is identical to the previous financial year 9M 2003-04 sales figure. Despite higher financial cost the company's pretax and after tax profits were higher last year in 9M 2004-05 and in this period the company incurred substantial capital expenditure also.
In the latest update for 9M 2005-06 the company's sales and gross profit figures were higher but pretax figures were lower as compared to relative figures of the same period last year. However net profit after tax for 9M 2005-06 at Rs 163.02 million were higher than Rs 159.06 million of July 2004-March 2005 (SPLY).
Yarn prices are high, markup rates are also high and fuel prices are still rising. Hence the 4th quarterly 2005-06 profitability might be on lower side.
Sapphire Fibres Limited is one of the constituent members of Sapphire Group of companies whose some other related undertakings are Sapphire Textile Mills Ltd, Neelam Textile Mills Ltd, Sapphire Power Generation Limited, Amer Cotton Mills (Private) Ltd etc.
The company was incorporated in the province of Sindh in June 1979 as a public limited company having its registered office situated at Cotton Exchange Building opposite City Railway Station Karachi.
Its manufacturing facilities are located at three places in two districts of Punjab ie District Sheikhupura and District Lahore. Its manufacturing facilities include spinning unit with 85,008 spindles, yarn/fibre dyeing unit, fabric dyeing unit, knitting unit and stitching unit. Hence it is principally engaged in the production and sale of yarn, fabrics and garments.
The shares of Sapphire Fibres Ltd are quoted at Karachi, Lahore and Islamabad Stock Exchanges. Currently the share is being quoted at the market value of Rs 97 per share which is nearly 10 times of the par value. Market value of the share remained quite high during the last one year as it ranged between Rs 75.10 and Rs 146.90 per share.
During the last six years, the company has record of uninterrupted annual dividends at average payout rate of 42.9%. Last year for nine months of financial year October 2004-June 2005 (9M 2004-05), the company announced cash dividend at 17.50% whereas for the previous financial year of 12 months (FY 2003-04) the company declared cash dividend at 15%. For the year 2000, the company's dividend payout was quite high at 145%.
During 9M 2004-05, the company made substantial additions in the fixed operating assets at the capital outlay of Rs 489.38 million (FY 2003-04: Rs 377.20 million). These capital expenditures were on account of Balancing, Modernisation and Replacement.
During 9M 2004-05, the company utilised production capacity for spinning unit at 99.4% for yarn/fibre dyeing unit at 20.96% for fabric dyeing unit at 63.82% for knitting unit at 43.57% and for stitching unit at 45.66%.
The reason for under utilisation of some of the capacities were attributed to market recessions and changes in production pattern. Last year, during 9M 2004-05, the company posted sales in terms of value at Rs 3,123.01 million which is for nine months and its annualised estimate works out to Rs 4,164 million. This annualised estimate is surprisingly identical to previous financial year's (FY 2003-04) actual sales figure of Rs 4140.67 million.
During the nine months of 2004-05 the company achieved higher gross profit of Rs 428 million (FY 2003-04: Rs 383.92 million), pretax profit at Rs 281.59 million (FY 2003-04 Rs 250.76 million) and after tax profit at Rs 221.23 million (FY 2003-04: Rs 192.21 million).
Profitability was higher despite higher finance costs.
The latest update of its financials is its publishing of unaudited accounts for nine months of current financial year 2005-06 (9M 2005-06). The company has not mentioned its websites URL on report in the annual report 2005. However, through search engines the URL could be traced and quarterly unaudited accounts of March 31, 2006 (9M 2005-06) could be downloaded.
In this period the company posted net sales at Rs 3.323 billion registering 8.17% growth over same period last year (SPLY). Gross profit increased by 28.88% whereas financial costs for the nine months (9M 2005-06) were quite high at Rs 191.96 million (SPLY: Rs 83.87 million) mainly due to general rise in mark up rates. Pretax profit at Rs 209.15 million (SPLY: Rs 211.33 million) were lower. But EPS was higher at Rs 9.32 (SPLY Rs 9.09).
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Performance Statistics -
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Balance sheet -As At-
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June 30 September 30
2005 2004
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Share Capital-Paid-up: 175.00 175.00
Reserves & Surplus: 2,703.01 2,212.06
Shareholders Equity: 2,877.01 2,387.06
L.T. Debts: 470.60 374.58
Staff Retirement Benefits-Gratuity: 58.43 51.81
Deferred Taxation: 61.30 37.01
Current Liabilities: 2,248.68 1,495.30
Fixed Assets: 2,347.23 1,941.39
L.T. Investments: 972.50 618.84
L.T. Loans: 5.86 5.35
L.T. Security Deposits: 0.93 0.96
Current Assets: 2,390.50 1,779.22
Total Assets: 5,717.02 4,345.76
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Profit & Loss A/c for
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9 Months Ended Year Ended
June 30 2005 Sept 30 2004
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Net Sales: 3,123.01 4,140.67
Gross Profit: 428.02 383.92
Other Operating Income: 37.97 27.56
Operating Profit: 395.03 335.88
Finance (Cost): (113.44) (85.12)
(Depreciation): (149.49) (179.21)
Profit Before Taxation: 281.59 250.76
Profit After Taxation: 221.23 192.21
Earnings Per Share (Rs): 12.64 10.98
Dividend (%): 17.50 15.00
Share Price (Rs) on 07/07/06: 97.00 -
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Financial Ratios
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Price/Earning Ratio: 7.67 -
Book Value Per Share: 164.46 136.40
Price/Book Value Ratio: 0.58 -
Debt/Equity Ratio: 11:98 14:86
Current Ratio: 1.06 1.19
Asset Turn Over Ratio: 0.55 0.95
Days Receivables: 62 47
Days Inventory: 187 78
Gross Profit Margin (%): 13.71 9.27
Net Profit Margin (%): 7.08 4.64
R.O.A. (%): 3.87 4.44
R.O.C.E. (%): 6.39 6.74
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Plant Production
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A) Spinning Unit (Million lbs)
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Actual Production (20's Count Converted): 41.770 53.543
Number of Spindles Installed: 85,008 77,712
Capacity Utilization (%): 99.41 99.09
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B) Yarn/Fibre Dyeing Unit (Million lbs)
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Actual Production: 1.972 3.297
Capacity Utilization (%): 20.96 43.50
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C) Fabric Dyeing Unit (Million lbs)
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Actual Production: 6.457 7.148
Capacity Utilization (%): 63.82 52.98
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D) Knitting Unit (Million lbs):
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Actual Production: 5.400 6.786
Capacity Utilization (%): 43.57 40.33
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E) Stitching Unit (000 Pcs)
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Actual Production: 248.40 92.55
Capacity Utilization (%): 45.66 23.80
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