Honda Pakistan profit declines 49pc

KARACHI: Honda Atlas Cars Pakistan Limited net profit fell 49 percent to Rs509 million for the quarter ended September 30, 2019, translating into earnings per share (EPS) of Rs3.57 a bourse filing said on Thursday.

The company earned Rs1.030 billion with EPS of Rs7.22 in the corresponding quarter last year. The company did not announce any interim dividend for the quarter ended September 30, 2019.

Net sales of the company fell by 55 percent to Rs11.646 billion in the quarter under review from Rs25.817 billion in the corresponding quarter last year, due to 67 percent YoY fall in volumes during the outgoing quarter. Decline in volumes was led by 68 percent YoY lower City and Civic sales, and 59 percent decline in BRV sales.

Other operating income of the company has declined by 93 percent YoY due to low base of short-term investments as advances received from customers have been on declining trend due to depressing demand. Finance cost has increased significantly due to increased borrowings on higher interest rate.

Analyst Hammad Akram from Topline Securities marked out some key risks for the company, including unfavourable movement in exchange rate, regulatory changes, increased competition from existing and new players, and disruptions in operations of the principal company.