Exide Pakistan Limited Reports Varied Q1 Financial Outcomes Amidst Economic Shifts

Karachi: Exide Pakistan Limited disclosed its financial performance for the first quarter ending June 30, 2024, today. According to information available from the Pakistan Stock Exchange (PSX), the Company saw a 17.26% increase in net sales revenue, reaching PKR 8.286 billion, up from PKR 7.066 billion in the previous quarter. However, despite higher revenues, gross profit dipped slightly to PKR 1.543 billion from PKR 1.575 billion, attributed to reduced margins.

The broader economic backdrop features a moderate recovery with Pakistan’s GDP growing by 2.38% in FY 2024, reversing a previous contraction of 0.21%. Significant growth was observed in the agricultural sector, which expanded by 6.25%, marking the highest increase in 19 years. Inflation showed signs of easing, decelerating to 12.6% in June 2024, influenced by stringent monetary and fiscal policies alongside stable currency conditions.

Trade dynamics also improved, with the trade deficit contracting by 12.3% to USD 24.09 billion, supported by a 10.54% rise in exports and a marginal reduction in imports. The financial landscape was further stabilized by a 10.7% increase in workers’ remittances, totaling USD 30.25 billion for FY 2024, and a substantial 79% reduction in the current account deficit to USD 0.681 billion.

Despite the positive sales revenue, Exide faced increased costs across the board. Selling and distribution expenses surged by 42.5%, reaching PKR 492.40 million, while administration and general expenses climbed by 36.4% to PKR 68.99 million, primarily due to inflationary pressures. Operating profit consequently declined to PKR 0.982 billion from PKR 1.179 billion in the previous year, and profit before tax decreased to PKR 711.98 million from PKR 927.97 million.

The profitability challenges are partly due to the sluggish performance of the automobile industry, which indirectly impacts the demand for Exide’s batteries. Despite these challenges, the Company remains optimistic about sustaining demand driven by ongoing energy shortages and the rising interest in solar projects.

In acknowledgment of the collective efforts contributing to the quarter’s outcomes, the Chairman expressed gratitude towards stakeholders including employees, shareholders, and partners like Furukawa Battery Japan for their continued support and trust.

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