Lucky cement financial analysis
LUCKY CEMENT
OVERVIEW
Lucky Cement Limited (LCL), the largest manufacturer and premier exporter of quality cement, is sponsored by ‘Yonus Brothers Groups.’ The company entered into the commercial business with a production capacity of only 1.2 million tons per annum. Today, the company is producing 25,000 tons of dry cement per day and has a production capacity of 7.75 million tons per annum.
Lucky Cement, being Pakistan’s first cement company to export sizable quantities of dry cement, has grown substantially and is expanding its operations related to production to different strategic locations to cater to cement demand in southern regions effectively. As per today (FY13), Lucky Cement has managed to increase its production by 3.6% as compared to the prior year.
The company has made investments in acquisition of ICI Pakistan; is currently in a process of negotiation of terms and conditions of a Joint Venture investment in Cement plan in DR Congo etc. Hence, it is undertaking expansion and is diversifying while expanding.
FINANCIAL ANALYSIS OF LUCKY CEMENT LIMITED
Profitability
Sales Revenue increase by 13.47% in FY 13 from the prior year. Out of this total increase, growth in net sales revenue, 1.4% was due to increase in volume while the remaining was due to net retention. The reason for this increase was the increased prices of cement. The cement prices increased by 79% in last three years. Above this, most of the increase was due to local sales rather than exports.
Cost of sales increased compared to prior fiscal year (2010). However, if sales to CGS ratio is looked at, the ratio fell from 1.9 in FY12 to 1.7 in FY13. The prime reason for this is the fall in the price of raw materials and increase in the prices of final product. This ratio, however, was lower in FY11 as compared to both following fiscal years. The reason for this ratio to be as low as 1.5 was the same as FY 2013; international coal prices fell to $ 75 per ton showing a 48% fall from
OVERVIEW
Lucky Cement Limited (LCL), the largest manufacturer and premier exporter of quality cement, is sponsored by ‘Yonus Brothers Groups.’ The company entered into the commercial business with a production capacity of only 1.2 million tons per annum. Today, the company is producing 25,000 tons of dry cement per day and has a production capacity of 7.75 million tons per annum.
Lucky Cement, being Pakistan’s first cement company to export sizable quantities of dry cement, has grown substantially and is expanding its operations related to production to different strategic locations to cater to cement demand in southern regions effectively. As per today (FY13), Lucky Cement has managed to increase its production by 3.6% as compared to the prior year.
The company has made investments in acquisition of ICI Pakistan; is currently in a process of negotiation of terms and conditions of a Joint Venture investment in Cement plan in DR Congo etc. Hence, it is undertaking expansion and is diversifying while expanding.
FINANCIAL ANALYSIS OF LUCKY CEMENT LIMITED
Profitability
Sales Revenue increase by 13.47% in FY 13 from the prior year. Out of this total increase, growth in net sales revenue, 1.4% was due to increase in volume while the remaining was due to net retention. The reason for this increase was the increased prices of cement. The cement prices increased by 79% in last three years. Above this, most of the increase was due to local sales rather than exports.
Cost of sales increased compared to prior fiscal year (2010). However, if sales to CGS ratio is looked at, the ratio fell from 1.9 in FY12 to 1.7 in FY13. The prime reason for this is the fall in the price of raw materials and increase in the prices of final product. This ratio, however, was lower in FY11 as compared to both following fiscal years. The reason for this ratio to be as low as 1.5 was the same as FY 2013; international coal prices fell to $ 75 per ton showing a 48% fall from