Despite massive decline in sales, the profit-after-tax (PAT) of Honda Atlas Cars (Pakistan) Limited (HCAR) rose nearly 797%, clocking in at Rs2.33 billion for the year ended March 31, 2024, as compared to PAT of just Rs260.14 million recorded in the same period of the previous year.
As per HCAR’s financial statements made available at the Pakistan Stock Exchange (PSX) on Wednesday, the automobile company’s earnings per share (EPS) stood at Rs16.34 during the year, compared to an EPS of Rs1.82 last year.
The company’s Board of Directors also announced a final cash dividend of Rs6.5 per share i.e. 65%, as compared with the nil per share dividend declared last year.
The rise in profit can be attributed to a massive decline in other expenses and lower taxation during the period.
Honda Atlas Cars’ profit-after-tax plunges 82% in Oct-Dec
During the year, HCAR’s sales declined to Rs55.07 billion, as compared to Rs95.08 billion in SPLY, a fall of over 42%.
Subsequently, the company reported a gross profit of Rs4.51 billion in FY24, 2024, a drop of over 37%, as compared to a gross profit of Rs7.16 billion in SPLY. However, despite lower gross profits, HCAR’s gross margins rose to 8.2% in FY24, as compared to 7.5% in SPLY.
Moreover, the company witnessed a jump in its administrative expenses which stood at Rs1.48 billion in FY24, up by 12%, as compared to Rs1.32 billion in SPLY.
However, HCAR’s other expenses registered a massive decline of 92%, amounting to Rs393.6 million in FY24, in comparison to Rs4.93 billion in FY23.
The automaker also saw its finance cost jump over 252%, standing at Rs1.22 billion in FY24, as compared to Rs346.1 million in SPLY.
The company managed to post Profit before Taxation (PBT) of Rs2.75 billion in FY24, up nearly 39% YoY.
However, despite a higher PAT, the company paid only Rs418.85 million in taxes in FY24, as compared to Rs1.72 billion in SPLY, a decline of nearly 76%.
Incorporated in Pakistan as a public limited company in 1992, HCAR commenced its commercial operations in 1994. The company was formed as a result of a joint venture between Honda Motor Co., Ltd., Japan and Atlas Group of Companies, Pakistan.
The company is engaged in the assembly and progressive manufacturing as well as sale of Honda vehicles and spare parts.