Indus Motors Company Limited (IMCL) has earned Rs 1,361.083 million as profit after tax in the six month period ended December 31, 2007 as compared to Rs 1,278.092 million in the corresponding period in 2006. The company earning per share surged to Rs 17.32 in the period under review against Rs 16.26 in the same period a year back.
The board of directors of the company in its meeting held here on Friday recommended an interim cash dividend for the half-year period at Rs 4.00 per share ie 40 percent. According to a notice sent to Karachi Stock Exchange (KSE), the company's net sales surged to Rs 18.699 billion in the half year period as compared to Rs 18.421 billion in the same period in 2006. The cost of sale stood at Rs 16.503 billion in this period against Rs 16.470 billion previously.
The company in a statement issued here said that during the half year, production of Indus Motor's Toyota and Daihatsu brands was 22,824 units, a new record for the Company, as compared to 22,489 units produced during the same period in 2006. Sales of Toyota and Daihatsu products for the six months ended December 2007 were 23,138 units, down 3 percent from the 23,905 units achieved in the same period the previous year.
However, despite a declining market, Indus was able to increase its overall market share of passenger cars and light commercial vehicles to 23 percent, up from the previous years 22 percent. The new generation of Toyota Hilux was also launched in November 2007 and witnessed strong demand during this period.
IMC's total sales revenue for the half year, at Rs 18.7 billion, and profit after tax of Rs 1.4 billion, are new company records. The board of directors declared an interim dividend at 40 percent or Rs 4.00 per share for the half year ended December 2007, versus Rs 5.00 per share paid for the same period last year.
The domestic automobile industry, which has shown impressive growth rates for the last several years, recorded its first half-year drop in volume since 2001, prima facie due to the uncertainty emanating from the political environment in the country.
Nation-wide sales of locally assembled passenger cars, light commercial vehicles (LCV), new and used cars was 99,681 nits, down 9 percent compared to 110,085 units sold during the Half Year ended 31 December 2006.
The unsatisfactory law and order situation, tightening of auto finance and imposition of 2.5 percent withholding tax effective September 2007 contributed towards the decline in the second quarter. Total industry production of CKD cars and LCV at 94,300 units was nearly the same in the corresponding period last year.
With the near term outlook expected to remain challenging, given the tightening of the monetary policy, it is essential that the new government takes proactive measures to boost the auto sector, which remains a major contributor to the national exchequer.