Amreli Steels Limited (ASTL) announced its 4QFY19 financial result on Thursday where the company posted a loss after tax (LAT) of PKR 191mn (LPS: PKR 0.64), compared to last year’s profitability of PKR 588mn (EPS: PKR 1.98). This took the FY19 bottom-line to PKR 33mn (EPS: PKR 0.11), down by 98% YoY. Topline in 4QFY19 witnessed a massive growth of 113% YoY to PKR 9.87bn.
This can be owed to robust operations at the Dhabeji plant led by suspension of shipbreaking at the Gadani coastal region post a fatal fire incident, along with higher rebar prices. During FY19, volumetric growth amid aforementioned reasons, tagged with improvement in retail prices aided revenue growth of 84% YoY. Gross margins at 5.9% in 4QFY19 compare starkly to 13.2% in 4QFY18, down by 7ppts YoY. Although we expected higher margins during the quarter under review, we believe PKR depreciation against USD and recognition of high