Sazgar’s Profit Grows by Nearly 700% in FY24 

Sazgar Engineering Works Limited (PSX: SAZEW) has announced a profit after tax (PAT) of Rs. 7.93 billion (EPS: Rs. 131.29) for the fiscal year 2023-24 (FY24).  The company’s profit surged nearly 700 percent in FY24 compared to the profit of Rs. 995 million (EPS: Rs. 16.46) reported in FY23.  During 4QFY24 earnings clocked in at Rs. 3,487 million (EPS: Rs. 57.69), showcasing a significant jump of 7.4x over the previous year. The company also announced a final cash dividend of Rs. 12 per share bringing the total annual payout to Rs. 20 per share.  Topline during FY24 surged by 3.2x YoY clocking at Rs. 57,642 million. This growth was driven by a 3x increase in Haval sales YoY, totaling 5,374 units, as well as a 1.6x YoY rise in three-wheeler sales to 15,014 units. During 4QFY24 net sales increased by 4.1x YoY to settle at Rs. 23,058 million in contrast to RS. 5,581 million in SPLY.   For FY24, gross margins improved to 27 percent, up from 14 percent in the same period last year. This increase was primarily driven by concessionary customs duties and GST on Haval vehicles, coupled with stability in the exchange rate. During 4QFY24, gross margins were recorded at 29 percent compared to 23 percent recorded in SPLY.   Other income surged by 27x YoY to Rs. 832 million in FY24 due to higher income from cash and cash equivalents. In 4QFY24, the other income arrived at Rs. 481 million, up 38x YoY.   Other expenses rose significantly by 9.8x to Rs. 1,000 million, while on the quarterly basis they went up by 9.4x to Rs. 456 million. The company booked effective taxation at 39.6 percent in 4QFY24 against 35 percent in 4QFY23.  *Story based on Arif Habib Limited’s result review of the company.