AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
Karachi: Al-Ghazi Tractors Ltd. (AGTL) convened an analyst briefing to discuss its financial results and strategic outlook for the fiscal year 2024 and the first quarter of 2025. The company reported earnings of PkR3.5 billion for CY24, a notable rise from PkR2.6 billion in the previous year, driven by improved gross margins.
The briefing highlighted a significant 50% increase in operating expenses due to the transition to a new SAP S/4HANA system and complimentary tractor deliveries under Punjab’s Green Tractor Scheme. Despite these challenges, AGTL remains optimistic about future growth.
The company’s topline plummeted to PkR3.6 billion in 1QCY25, a 62% decline from the same period last year. This drop is attributed to reduced sales volumes amid challenging agricultural conditions. Despite this, AGTL received PkR2.5 billion in outstanding dues from the Punjab Government, which will help stabilize its financial standing.
AGTL management noted a shift in consumer preference towards lower horsepower tractors in early 2025, but they expect a rebound in demand for higher horsepower models. This optimism is fueled by the Punjab government’s new tractor schemes, worth PkR15.5 billion, set to subsidize 20,000 tractors, potentially boosting sector performance.
The launch of the new NH-850 tractor model received a positive market response, leading to an improved variant’s introduction. The research and development center’s completion by the end of 2025 is anticipated to further enhance product offerings.
Management addressed concerns over unpaid dividends, clarifying that these are pending approval and pertain only to foreign investors, with minority shareholders having been compensated. The company plans to reinvest in its factory as sales and revenues decline, indicating a pause on dividend payouts in the near term.