Sazgar Engineering Works Limited (SAZEW) has announced impressive financial results for the fiscal year 2024, with a profit after tax (PAT) of Rs. 7.936 billion, translating to earnings per share (EPS) of PKR 131.29. This marks a significant increase from the previous year’s PAT of Rs. 995 million (EPS: PKR 16.46), showcasing an 8x year-on-year (YoY) growth.

In the fourth quarter of FY24, the company reported earnings of Rs. 3,487 million (EPS: PKR 57.69), reflecting a substantial 7.4x YoY increase. A final cash dividend of Rs. 12.0 per share was announced, bringing the total annual payout to Rs. 20.0 per share.

Revenue Growth: The company’s topline surged by 3.2x YoY, reaching Rs. 57,642 million. This growth was driven by a 3x increase in Haval sales, totaling 5,374 units, and a 1.6x YoY rise in three-wheeler sales to 15,014 units. Net sales for 4QFY24 increased by 4.1% YoY to Rs. 23,058 million.

Gross Margins: For FY24, gross margins improved to 27% from 14% in the previous year, aided by concessionary customs duties and GST on Haval vehicles, along with stable PKR parity. In 4QFY24, gross margins were recorded at 29%.

Other income soared by 27x YoY to Rs. 832 million, primarily due to higher income from cash and cash equivalents according to a report by Arif Habib Ltd. In 4QFY24, other income was Rs. 481 million, a 38% YoY increase.

Expenses and Taxation: Other expenses rose by 9.8x YoY to Rs. 1,000 million. The company booked effective taxation at 39.6% in 4QFY24, compared to 35.0% in 4QFY23.
Expansion Plans:

Sazgar Engineering plans to invest Rs. 4.5 billion in expansion, funded through internal cash reserves. This includes new warehousing facilities, expansion of the paint shop, installation of a solar system, and establishment of manufacturing facilities for local assembly of new energy vehicles, pending regulatory approval.