The profit of Indus Motor Company (IMC), the makers of Toyota cars in Pakistan, fell 21% to PKR 3.4 billion in the quarter ended March 31, 2019 despite a rise in net sales. This was revealed by the company in a notification sent to the Pakistan Stock Exchange (PSX) on Friday.
The company has posted a net profit of PKR 4.3 billion in the same period last year. IMC’s earnings per share (EPS) fell from Rs 54.35 in January-March last year to Rs 42.56 in the same period in 2019. Though net sales of IMC increased to Rs 41.5 billion in January-March 2019 compared to Rs 36.7 billion in the same period of 2018, witnessing a hike of 13%.
The overall revenue increased due to improved volumes of Toyota Corolla, whereas the net profit declined mainly on account of the rise in input costs due to the depreciation of Pak Rupee against US Dollar and Japanese Yen. IMC, along with its automotive peers has been raising prices multiple times since December 2017.
Commenting on the performance, CEO of IMC Ali Asghar Jamali said that the recent imposition of 10% FED has drastically reduced the sales volumes of 1700cc and above vehicles. Jamali strongly believes that this decision needs to be revisited in order to attain sustainable volumes that will not only support the auto sector but will also result in higher overall revenue to the government.