DG Khan Cement Company Limited (DGKC): Financial Results - Q3 2024
Earnings per Share (EPS): Rs. 2.69 for Q3 2024, flat compared to the same quarter last year. Nine-month EPS stands at Rs. 5.10.
Dividends: The company is not yet in a position to pay dividends. However, improved margins suggest a turnaround in profitability.
Operating Performance: Sales in the third quarter decreased by 22% compared to the same period last year, reflecting the general economic downturn. However, margins improved due to favorable coal prices. Lower distribution expenses also contributed to a 9% increase in profit before tax. Despite this, profit after tax remained flat at Rs. 1.18 billion due to a higher tax expense of 39%.
Profitability: High interest payments are a major drag on profitability. For the first nine months of this fiscal year, DGKC's financial charges exceeded 65% of gross profit. Note that the company had incurred a significant loss of over Rs. 7.2 billion in the fourth quarter of the last financial year.
Industry Outlook: Pakistan's cement sector is heavily influenced by international coal prices. For a deeper understanding, refer to our blog post on coal.
Ownership Structure: Nishat Mills (NML) is the largest shareholder in DG Khan Cement (DGKC) with a 31% stake. Interestingly, DGKC also holds minority stakes in both Nishat Mills (8.6%) and Adamjee Insurance (almost 8%).
Stock Performance: DGKC is currently trading around Rs. 70 per share, reflecting a year-to-date decline of around 10%. However, the stock has gained roughly 60% over the past year, highlighting the depressed levels of the PSX last year.
Market Weight: DG Khan Cement (DGKC) is a constituent of all major PSX indices. It carries a weight of 0.68% in the KSE 100 index, 0.97% in the KSE 30 index, and 1.37% in the KMI 30 index.
Company Profile: DG Khan Cement Company Limited (DGKC), a prominent player in Pakistan's cement sector, boasts a daily production capacity of 22,400 tons. This translates to an annual capacity of 6.72 million tons, making them one of the country's leading manufacturers. Their dominance is further solidified by their four strategically located plants, all equipped with cutting-edge dry process technology.
DGKC Results announcement Mar 2024
