Din Textile Mills Limited reported a loss per share of PKR 53 for FY24, compared to PKR 17 per share in FY23, reflecting a 219% increase in losses. Furthermore, in 1QFY25 the company has reported loss per share of PKR 22 against loss per share of PKR 15 in SPLY.
The company operates four spinning units with a total of 136,656 spindles. Despite challenges, sales revenue grew by 23%, increasing from PKR 32.31 billion in FY23 to PKR 39.61 billion in FY24. However, the loss after tax surged by 219.13%, rising from PKR 0.87 billion in FY23 to PKR 2.77 billion in FY24.
The primary drivers of these substantial losses were high raw material costs, a cotton shortage, and rising finance expenses. The company has not paid any dividends since 2019 due to its ongoing expansion phase and weak earnings, resulting in a 0% dividend payout over the past four to five years.
Total assets decreased by 8.57%, reflecting a decline linked to the company’s major expansion efforts. Key challenges faced by the company include escalating energy costs, a shortage of cotton (with production falling from an expected 8.5 million bales to just 4-5 million due to low yields and quality issues). further crop damage is expected in upcoming season caused by heavy rains, which led to excessive moisture and lower quality. In response, the company is planning to import cotton to maintain production levels.
However, Din Textile anticipates a reduction in its net loss by PKR 1.5 billion due to a decline in finance costs. The company also expects a positive impact from lower natural gas prices, as it relies heavily on gas.
In addition, the company has been working on integrating solar energy into its operations for the past 1 to 1.5 years, with 10% of its power currently sourced from solar panels. It is focusing on further increasing solar reliance, especially if gas price cuts materialize in the coming months.
Important Disclosures
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