KARACHI: JWD Sugar Mills Limited, one of the largest producers and export firms, reported a significant surge in net earnings for the year ended September 30, as it managed to produce more sugar at comparatively lower cost, said an official after filing profit and loss accounts at a bourse on Monday.
The firm reported almost 55 percent surge in profit-after-tax at Rs1.51 billion for the year ended September 30, 2015, it reported at the Karachi Stock Exchange (KSE).
"The firm has developed high yield producing seeds for sugarcane at its lab and given them to farmers (who sell production to the firm)…the average yield from the seeds is around 800-850/maund per acre in Rahim Yar Khan as compared to average countrywide yield at 450-500/maund," said Muhammad Rafique, company secretary.
The higher yield has helped the firm to produce a higher quantity at lower cost. It operates four production lines; two at Rahim Yar Khan, one at Ghotki, while Daharki Sugar Mills is its fourth production line, which it owns as its 100 percent subsidiary.
He said higher yields have made the country not only self-sufficient, but also enabled to produce surplus sugar in the last four years. Prior to that, the country used to produce surplus once in four years or had to import to meet local needs.
He said market share of the firm (JWD) in production stood at 13-14 percent of total production, while it enjoys almost the same market share in exports.
According to industry sources, the country has produced 5.4 million tons sugar last season (November-2014 to April 2015) and exported over 500,000 tons in the first eleven months (January-November) of 2015.
Rafique added out of around 84 sugar mills in total in the country, some 70-75 percent were in profit. "The mills operating in central Punjab are in trouble. Otherwise, the mills operating in southern Punjab and Sindh are mostly in profit."
The consolidated profit-after-tax of the firm, which includes earning from businesses other than its core sugar one, grew at a faster pace than unconsolidated profit. The unconsolidated profit climbed by almost 120 percent to Rs2.11 billion from Rs960.95 million in the previous year ended September 30, 2014.
"The start of electricity production to the national grid station from its recently built two power projects have helped the firm to earn higher (unconsolidated) income," said the company secretary.
The board of directors has recommended a final cash dividend at Rs7/share. With this, the cash dividend in the year under review totalled at Rs10/share, company reported at the bourse.
The company sold sugar worth Rs34.98 billion, which is eight percent higher than worth Rs32.32 billion in the previous year.
The finance cost, however, remained on the higher side at Rs2.24 billion, which was 19 percent higher than Rs1.88 billion last year, it added.
JDW share surged by Rs5.06, or 1.71 percent, to Rs300.06 with a volume of 1,300 shares at KSE on Monday.
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