Murree Brewery Reports Rs. 1.22 Billion Profits in FY19 - Android

Murree Brewery Company Limited, which is one of the oldest firms in Pakistan, announced its financial results for the year… Read More

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Murree Brewery Company Limited, which is one of the oldest firms in Pakistan, announced its financial results for the year ended June 30th, 2019.

The company announced a profit of Rs. 1.22 billion, decreasing by 5.43% as compared to Rs. 1.29 billion in the same period last year. The profits decreased due to an increase in raw material costs which was mainly due to the devaluation of Rupee against the US dollar.

The company reported overall sales of Rs. 9.98 billion, showing a growth of 10.30% as compared to Rs. 9.05 billion. However, the cost of sales of the company increased to Rs. 7.23 billion as compared with Rs. 6.18 billion last year, which is almost up by 17%.

The company has three divisions; liquor, glass, and Tops division that makes juices, etc. Amongst these, liquor is the most profitable. The firm also has a Tetra Pak packaging facility.

The Glass division is located in Hattar.

Divisional Operating Results

• The liquor division has grown consistently in recent years. It reported sales of Rs. 7.67 billion compared to Rs. 6.97 billion in the same period last year. However, this year it posted an operating profit of Rs 1.03 billion, down by 19.53% from last year’s operating profit of Rs 1.28 billion due to the increase in the cost of sales.
• The glass division showed an operating profit of Rs. 605 million, up by 3% from Rs 586 million in the same period last year. The sales were posted at Rs. 1.7 billion during this year as compared to Rs. 1.58 billion last year.
• The tops division reported an operating loss of Rs. 117 million, up from a loss of Rs. 96 million last year. It reported sales of Rs 2.82 billion as compared to 2.53 billion.

The overall selling and distribution expenses saw an increase of 24.12% to Rs.939 million from the previous year. The other income of the company was posted at Rs. 107 million as compared with 90.02 million. The net finance income of the company was reported at Rs. 261 million against Rs. 172 million in the same period last year.

Earnings per share of the company decreased to Rs. 44.21 as compared with Rs. 46.86 last year. The company also announced a cash dividend of Rs.10 per share i.e. 100%. This is in addition to interim dividends already paid at Rs. 20.

Issues Faced by the Company

According to the company’s annual report, the decision on the ban of liquor sales in Sindh is still pending before the Supreme Court. Sindh Wine Association got a stay from the Supreme Court against the order of the Sindh High Court.

Liquor was banned in Sindh back in 2016.

Moreover, Sindh Wine association has won the case which was filed by the Punjab Government in the Lahore High Court.

However, Punjab Excise is still taking extra duty from non-Punjab wine dealers, as Punjab Excise filed an appeal and got a stay from the Supreme Court.

While commenting on the Gas Infrastructure Development Cess (GIDC), the total unpaid amount due to stay is Rs. 217 million. The government is reviewing the entire GIDC position and the company will take appropriate action after the decision is announced by the government.

The Supreme Court had announced its intention to tax the beverage industry Rs. 1 per liter of surface and underground water which would not be passed on to the consumers. The order was effective from December 2018 and applied to all industries consuming water in Pakistan, the rules for which have not been issued yet.

However, the company has installed meters to calculate the water consumption and the industry has lodged a review petition 

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