Toyota Pakistan announced impressive financial results for the first half of the fiscal year 2024. The company’s profit after tax amounted to Rs. 4.95 billion, marking an 89 percent increase Year-on-Year (YoY).
This strong performance highlights the company’s resilience and adaptability despite challenging market conditions.
Financial Highlights
In the second quarter of FY24, the company’s profitability increased to Rs. 1.74 billion, up by 31 percent compared to the same period last year. Additionally, Indus Motors declared a cash dividend of Rs. 13.2 per share, totaling Rs. 37.70 per share for the first half of FY24, likely to boost investor confidence.
However, despite strong profitability, net sales in 1HFY24 declined to Rs. 50.910 billion, a significant 41 percent decrease YoY. The decline was even more pronounced in the second quarter, with net sales plummeting by 63 percent YoY and 44 percent Quarter-on-Quarter (QoQ).
The primary reason behind this decline was the reduction in volumetric sales, particularly in Fortuner and Hilux, which decreased by 83 percent YoY.
Despite the challenging sales figures, Indus Motors significantly improved its gross margins. In 1HFY24, the gross margin was 9.3 percent, a stark contrast to the -3.3 percent reported during the same period last year.
Toyota Pakistan’s Rs. 3 billion Investment
Indus Motor Company Limited (INDU) is investing around Rs. 3 billion to enhance the localization of parts and components for its vehicles. This strategic move, approved by the Board of Directors, demonstrates the company’s commitment to reducing foreign exchange outflow and strengthening the local auto industry.
The investment will primarily focus on expanding the localization of existing vehicle models, in line with the company’s long-term objectives.
It includes expenses in plant infrastructure, machinery, molds, dies, and associated costs essential for localizing parts and components production. The targeted completion by the third quarter of 2025 indicates a diligent timeline for implementation.
