Tariq Corporation Reports Increased Sales Amidst Economic Turbulence and Notable Losses

Lahore: Tariq Corporation Limited released its financial results for the third quarter ending June 30, 2024, showing a mixed picture of increased sales but substantial losses. The company’s operational performance included a decrease in sugar production despite achieving higher sugar recovery rates.

The company processed 570,050 metric tons of sugarcane during this period, producing 58,183 metric tons of sugar with a recovery rate of 10.21%, an improvement over last year’s 9.76%. However, this was not sufficient to offset the financial challenges faced. According to information available from the Pakistan Stock Exchange (PSX), sales reached Rs. 6,699.016 million, a significant increase from Rs. 5,217.994 million in 2023. Despite this, the company reported a gross loss of Rs. 291.305 million, a stark reversal from the gross profit of Rs. 539.586 million in the previous year.

Operational costs were slightly reduced from Rs. 214.407 million to Rs. 201.057 million, but finance costs remained high at Rs. 222.113 million, though lower than the previous year’s Rs. 418.001 million. The financial strain culminated in a pre-tax loss of Rs. 676.724 million and an after-tax loss of Rs. 499.318 million, marking a significant downturn from the previous year’s profit.

The company cited several factors for its financial outcomes, including high input costs driven by inflation and currency devaluation, which have pushed up the costs of sugarcane and consequently, sugar production. The Minimum Support Price of sugarcane has increased substantially, affecting the overall cost structure. Despite these costs, Tariq Corporation has managed to maintain high sales levels by capitalizing on favorable sugar prices.

Looking forward, the company is optimistic about the upcoming crushing season. Predictions from their agricultural survey department suggest a slight increase in sugarcane plantation area and a significant boost in yield per acre due to favorable monsoon rains and effective use of fertilizers and pesticides. This optimism is bolstered by the company’s strategic moves to improve operational efficiency and reduce energy costs through their Efficiency Improvement Project, which has already shown promising results in reducing bagasse consumption and contributing to a cleaner environment.

The Board has also taken steps to strengthen the company’s financial position by disposing of non-core assets and investing in machinery efficiency upgrades. This strategy aims to transform non-earning assets into profitable ventures, optimizing the current economic conditions to benefit the company.

The directors have expressed their gratitude for the ongoing support from all stakeholders and recognized the dedicated efforts of the company’s employees during these challenging times.