Overview
Toyota Indus Motor Company (IMC) Limited has released its financial results for the six-month period ending December 31, 2022.
In the financial year 2022–23, from July through December, the IMC reported a profit of Rs. 2.6 billion, a 74 percent decrease from Rs. 10.2 billion during the same time the previous year.
Toyota Indus Motor Company Reduced Production
According to Arif Habib Limited, the reduction was caused by poor volumetric sales as a result of high vehicle costs, inflation, and customers’ low spending power.
Moreover, the manufacturer reduced its quarterly earnings in October-December finishing the quarter with a profit after tax of Rs. 1.33 billion, a 72 percent year-on-year decline from Rs. 4.7 billion the previous year. On a quarter-on-quarter basis, PAT is up 3% for the quarter.
In addition to the results, the company declared an intermediate cash dividend of Rs. 10.2 per share.
Half-Year Profit Of IMC
During the first half of the year, the company’s net revenues fell by 36% year on year to Rs. 86.8 billion from Rs. 135 billion. The top line fell by 29 percent year on year during 2023, with revenues falling from Rs. 69.6 billion to Rs. 49.6 billion. Sales increased by 33% year on year compared to January 2023.
Owing to poor sales, high raw material prices, and the observation of 11 non-production days due to raw-material (CKD) scarcity, gross margins were -1 percent in 2QFY23 compared to 7.6 percent SPLY.
Other revenue declined by 33% year on year to Rs. 3.45 billion, owing to a decrease in cash and cash equivalents. Other income climbed by 89 percent year on year, from Rs. 4.5 billion last year to Rs. 8.6 billion in July-December FY23.
Meanwhile, the effective tax rate was 31 percent in 2QFY23, up from 26.3 percent in 2QFY22.
Toyota IMC earned Rs. 33.4 per share during the half year, compared to Rs. 129.5 per share in 1HFY22.
The company’s stock at the time of reporting was Rs. 861, up 0.7 percent or Rs. 5.99, with a transaction of 11,213 shares on Monday.
Delivery Problems and a Sales Slump Reason
Toyota Indus Motor Company (IMC) has previously declared non-production days (NPDs) to accommodate slow CKD imports. According to recent reports, IMC is providing a complete refund plus a markup to consumers who just rented a car.
According to Ali Asghar Jamali, CEO of Toyota IMC, the falling economy and production interruptions are causing sales and income to dry up. The whole issue is severely harming the industry.
The auto sector as a whole has expressed similar concerns to the government and has called for the resumption of CKD imports to keep their operations viable.
