Toyota IMC’s Profits Decline 13 percent for FY 2018-19 - Android

Toyota Indus Motor Company (IMC), which is one of the most popular car brands in the country, has announced its… Read More

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Toyota Indus Motor Company (IMC), which is one of the most popular car brands in the country, has announced its financial results for the year that ended on June 30th, 2019. It posted a profit of Rs. 13.71 billion down 13.02% compared to Rs. 15.77 billion earned last year.

The decline in earnings was due to the rupee’s depreciation against the US dollar and the inflationary environment in the country.

The decline in the automobile industry was due to an overall economic slowdown, rising interest rates, and escalating vehicle prices on the back of the plunging Pakistani rupee against the US dollar and sky-rocketing inflation.

The net sales of the company during the period surged by 13.08% to Rs. 158 billion as compared with Rs. 139.71 billion in the corresponding period of last year.

The rise in sales was due to a higher sales volume of Toyota Corolla as it remained the best selling vehicle of the company.

The cost of sales grew to Rs 138.80 billion, showing an increase of 19.8%. Owing to this, the gross profit of the company went down to Rs. 19.19 billion as compared to Rs. 23.88 billion in the corresponding period.

The company’s other income increased by 10% YoY due to the increase in interest rates.

Sales Volume

The company sold over 65,399 units during the fiscal year (July 2018-June 2019), showing a growth of 3.7%, all thanks to the Corolla. The sales of  Toyota Fortuner and Hilux went down during the period under review. The company’s volumetric sales were down during the Q4 FY19(April-June) due to high prices.

IMC introduced a minor improvement in Toyota Corolla during this period along with introducing a first of its kind application, Toyota Connect. It also launched the automatic variant of Toyota Corolla XLI.

The application of 10% FED in Oct 2018 on vehicles above 1700cc negatively impacted the luxury vehicle segment of the company during the last 9 months of FY 2018-2019.

The government has introduced three tax slabs of 2.5% – 7.5%, along with increasing the rates of additional customs duty from 2% to up to 7% on inputs to manufacturing vehicles.

Source: PAMA

The combined sales of Toyota CKD and CBU vehicles stood at 66,211 units, up by 3.5% compared to 64,000 units in the previous year. Toyota’s market share stood at 22% for locally manufactured PC and LCV vehicles for the period.

Highest Ever Production

The company, despite an economic slowdown, has achieved the highest ever production record of 65,346 units, up by 3.91% compared to 62,886 units last year.

IMC’s board of directors announced a final dividend of Rs. 27.5 per share, making the annual dividend for the year Rs. 115 per share.

Ali Asghar Jamali, CEO Indus Motor Company said,

We are committed to the Pakistani market and to our loyal customers who have shown great trust in our products year on year. The combined impact of tax increases and PKR devaluation has increased the cost of inputs and ultimately result in further price increases. For sustained growth, consumer confidence is necessary. We urge the government to introduce policies that will restore market confidence and accelerate economic activities across the board.

During the year, the company contributed a sum of Rs. 56 billion to the national exchequer, which amounts to about 1% of the total revenue collection by the Government of Pakistan for the year, according to a statement released by the company.

INDU’s script at the exchange was closed at Rs. 1061.82, up by Rs. 5.88 or +0.56%, with a turnover of 4,840 shares on Tuesday.

You can check the Statement of Profit and Loss account below:

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