Kohat Cement Posts Highest Ever Quarterly Profit in Q1 FY25

Kohat Cement Company Limited (KOHC) has released its financial results for 1QFY25, reporting a profit after tax of Rs. 3,439 million (EPS: Rs. 17.56), compared to Rs. 2,229 million (EPS: Rs. 11.38) in the same period last year, reflecting a YoY increase of 54 percent. This marks the highest-ever quarterly profit achieved by the company, according to Arif Habib Limited. In 1QFY25, the topline reached Rs. 10,084 million, compared to Rs. 11,064 million in the same period last year, reflecting a decline of 9 percent YoY. This decrease is primarily due to a reduction in the dispatches, which totaled 595K tons, representing a 22 percent YoY decrease. Gross margins rose by 14pps YoY to reach 43 percent in 1QFY25. Additionally, on a QoQ basis, gross margins improved by 11pps. This is the highest gross margin after 3QFY17. The rise in gross margins due to higher retention prices and better coal inventory management, we view. Distribution expenses in 1QFY25 increased by 28 percent YoY, settling at Rs. 46 million compared to Rs. 36 million during SPLY on account of the elevated freight charges amid the axle load factor. The other income experienced a YoY increase of 70 percent, reaching Rs. 1,471 million in 1QFY25, primarily due to elevated earnings from short-term investments resulting from increased levels. Finance costs in 1QFY25 reduced by 43 percent YoY to Rs. 116 million as compared to Rs. 203 million during SPLY, amid a decline in interest rates. The company booked effective taxation at 33 percent in 1QFY25 vis-à-vis 36 percent in 10FY24