Cordoba Logistics & Ventures Limited (PS: CLVL) was incorporated in Pakistan as a public limited company in 1986. It was previously known as Mian Textile Industries Limited. The company changed its business from Textile to logistics and other ventures in 2021 after the acquisition of 70 percent of the company’s paid-up capital.

Pattern of Shareholding

As of June 30, 2024, CLVL has a total of 72.105 million shares outstanding which were held by 1753 shareholders. Directors, CEO, Sponsors, spouses and relatives have the majority stake of 80.94 percent in the company followed by local general public holding 17.81 percent shares of CLVL. The remaining ownership is divided among other categories of shareholders.

Financial Performance (2019-24)

CLVL’s topline immensely plunged in 2019; however, its bottom line turned out to be much healthier in 2019 than the previous year. In the subsequent two years, CLVL discontinued its business due to ongoing tense economic conditions. In the meantime, in 2020, it received an acquisition offer that was delayed due to the outbreak of COVID-19. During the first three quarters of 2021, the company was in the process of acquisition which was ultimately completed on April 22, 2021, after which the new management changed the principal line of business from Textile to logistics and other ventures. The company commenced its new line of business on June 30, 2021. In 2022, CLVL made revenue from its logistics business however it trickled down into a net loss. In 2023, not only did the topline make a staggering growth but the bottom line was also recovered from net loss. In 2024, both the top line and bottom line slid. The detailed performance review of each of the years under consideration is given below.

In 2019, CLVL (then Mian Textile Industries Limited) posted a topline drop of 88.4 percent year-on-year. The top line represented income from the trading of vehicles. The company’s trading business of textile products wasn’t profitable anymore due to a dejected macroeconomic backdrop and hence during the year, the company disposed of its fixed assets and transferred the ownership to M/s Pakistan Tiles (Private) Limited for Rs.410 million. The gross profit declined by 89.10 percent year-on-year in 2019 with GP margin clocking in at 7.2 percent, slightly lesser than the GP margin of 7.4 percent posted in the previous year. Operating expenses shrank by 17.22 percent year-on-year in 2019 due to a considerable dip in non-operational expenses particularly, fuel & power, impairment loss as well as salaries & wages. Other income which greatly propelled CLVL’s operating profit as well as net profit in 2018 massively slipped in 2019 due to the high-base effect on account of the write-off of long-term financial liabilities and deferred markup in 2018. As a consequence, the company made an operating loss of Rs.15.83 million in 2019 as against an operating profit of Rs.43.58 million posted in 2018. CLVL’s financial charges which comprised of bank charges inched down by 84.74 percent year-on-year in 2019. Income from discontinued operations which comprised of gain on disposal of assets held for sale saved the day for CLVL and translated into net profit of Rs.93.80 million in 2019, up 115.69 percent year-on-year. EPS also surged from Rs.1.97 in 2018 to Rs.4.24 in 2019.

In 2020 and 2021, the company was in the process of acquisition and didn’t undertake any commercial business activity which pushed its revenue (trading income) to absolute zero for the two years and hence no cost of trading. In 2020, the company’s operating expenses slumped by 33.85 percent year-on-year due to no distribution expenses and non-operational expenses incurred during the year. Other expenses also dived down by 90.73 percent year-on-year in 2020 due to a significant plunge in the provision for doubtful receivables booked during the year. Operating loss measured down by 7.64 percent year-on-year in 2020 to clock in at Rs.14.61 million. As no financial charges and taxation were incurred in 2020, the net loss also stood at Rs.14.61 million in 2020 with a loss per share of Rs.0.66. In 2021, operating expenses further sank by 25.13 percent year-on-year due to a sizeable drop in payroll expenses, utilities expenses as well as legal and professional charges incurred during the year. CLVL didn’t incur any other expense in 2021, however, made other income of Rs.5.14 million mainly on account of the disposal of land and other fixed assets. Operating loss and net loss were recorded at Rs.5.49 million in 2021, down 62.43 percent year-on-year with loss per share of Rs.0.24. In 2021, the new management approved to injection of Rs.200 million to meet the working capital requirements of the company, out of which Rs.25 million was already injected by the end of the year. In 2021, the company commenced its commercial activity by acquiring an equity stake in Trukkr (Private) Limited, a tech-enabled logistics company.

In 2022, CLVL registered revenue of Rs.8.3 million from its new line of business of providing commercial vehicles on rentals as well as logistics services. The sponsors further injected Rs.147.42 million into the company during the year and undertook other commercial activities such as investment in Finox (Private) Limited and Children Clothing Retail (Private) Limited. The direct cost was recorded at Rs.5.12 million which included loading and unloading costs as well as depreciation on vehicles. CLVL posted a gross profit of Rs.3.18 million in 2022 which translated into a GP margin of 38.28 percent. Operating expenses escalated by 24 percent year-on-year primarily on the back of fee and subscription charges, directors’ meeting fees, and auditors’ remuneration. Other income also slid by 61.45 percent year-on-year in 2022 due to the high-base effect on account of the disposal of fixed assets in 2021. Operating loss grew by 46.25 percent year-on-year in 2022 to clock in at Rs.8.03 million. CLVL incurred finance cost (bank charges) of Rs.0.58 million in 2022 which translated into a net loss of Rs.8.61 million, up 56.78 percent year-on-year. Loss per share grew to Rs.0.37 in 2022.

CLVL’s topline grew by 575.34 percent year-on-year in 2023 to clock in at Rs.56.05 million from logistics services and rental of commercial vehicles. CLVL also invested in Neem Exponential (Private) Limited and International Learning Center (Private) Limited to diversify its business operations. Besides, the company also incorporated a wholly owned subsidiary NBFC called Cordoba Leasing Limited. These investments were financed by a right issue of Rs.500 million which drove its total paid-up capital to Rs.721.052 million. Direct cost surged by 251.38 percent year-on-year in 2023. This culminated into 1097.70 percent growth in gross profit in 2023 with GP margin jumping up to 67.89 percent. Operating expense multiplied by 12.8 percent year-on-year in 2023. However, it was offset by a robust other income of Rs.15.04 million recorded in 2023, up 659 percent year-on-year. Hefty other income recorded during the year was the result of income on disposal of long-term investments, income on saving accounts, and income on advances to subsidiaries. CLVL made an operating profit of Rs.38.22 million in 2023, translating into an OP margin of 68.19 percent. Finance costs grew by 670.18 percent year-on-year in 2023. This was the result of a mark-up on a sponsor loan worth Rs.75 million obtained during the year to meet working capital requirements. After accounting for taxation expenses, the company recorded a net profit of Rs.31.23 million. EPS clocked in at Rs.0.52 in 2023 while NP margin stood at 55.71 percent.

In 2024, CLVL recorded an 18.05 percent year-on-year dip in its topline due to a decline in revenue from the logistics and rental service business. This was on account of deteriorating macroeconomic fundamentals which resulted in depressed business activity of its customers. The direct cost dropped by 17.44 percent in 2024, resulting in an 18.34 percent shrinkage in gross profit. GP margin largely remained intact at last year’s level. Operating expenses tumbled by 14.24 percent in 2024 due to considerably lower fee subscription charges, directors’ meeting fees as well as payroll expenses. Other income mounted by 59.29 percent in 2024 due to a tremendous rise in mark-up income from loan to subsidiary. Operating profit ticked up by 10.62 percent in 2024 with OP margin climbing up to 92 percent. Finance costs escalated by 313.23 percent in 2024 due to a higher discount rate and an increase in the sponsor’s loan. CLVL recorded a net profit of Rs.19.105 million in 2024, down 38.82 percent year-on-year. This translated into EPS of Rs.0.32 and NP margin of 41.59 percent in 2024.

Recent Performance [1QFY25]

During the period under consideration, CLVL posted a 39.72 percent year-on-year slump in its topline. Consequently, the company incurred lesser loading and unloading costs which squeezed the direct cost by 51.19 percent in 1QFY25. In absolute terms, gross profit shrank by 34.29 percent in 1QFY25, however, GP margin improved from 67.9 percent in 1QFY24 to 74 percent in 1QFY25. Operating expenses dropped by 29.23 percent during the period due to considerably lower fee and subscription charges incurred. Rent, rates, and taxes also slid during the period. Other income plummeted by 31 percent during 1QFY25 due to lesser mark-up income from loan to subsidiary, Cordoba Financial Services Limited. Last year, the loan granted by CLVL to its subsidiary was matured. During the period under consideration, the company extended another long-term loan of Rs.20.5 million to a subsidiary company. CLVL recorded a 34 percent drop in its operating profit in 1QFY25, however, OP margin strengthened from 86 percent in 1QFY24 to 94 percent in 1QFY25. Finance costs surged by 45.16 percent in 1QFY25 due to an increase in loans from sponsors. Net profit slid by 96 percent to clock in at Rs.0.25 million in 1QFY25 with EPS of Rs.0.003 versus EPS of Rs.0.09 recorded during the same period last year. NP margin drastically fell from 49.4 percent in 1QFY24 to 3.21 percent in 1QFY25.

Future Outlook

Depressed business activity on account of political and economic instability didn’t allow the company to materialize its forecasted revenue stream as a logistics and vehicle rental business. However, the company is making continuous efforts to diversify its revenue by investing in varied businesses and sectors. This may keep CLVL revenue and profits afloat in the coming times.