Honda Pakistan's Profit Surge: 300% Growth to Rs. 566 Million in Q4 FY2024
- Abeera Marium Siddiqui
- January 23, 2025
- 10:11 am
- 43
- Business
Honda Pakistan’s Profit Surge is making headlines, with the company reporting an impressive 300% growth in Q4 FY2024. The automaker earned Rs. 566.4 million in the last three months of 2024, compared to Rs. 143.3 million in the same period last year. This marks a remarkable 295% year-on-year (YoY) increase.
Earnings per share (EPS) climbed to Rs. 3.97, significantly higher than Rs. 1 in the previous year. Revenue also saw a 44% jump, reaching Rs. 17.85 billion compared to Rs. 12.43 billion last year. This impressive performance demonstrates Honda’s ability to navigate challenges and capture market growth.
Sales Surge and Improved Margins
Sales growth was a critical driver of Honda Pakistan’s profit surge. Despite a 42% rise in the cost of sales (Rs. 16.2 billion), the company managed to boost gross profit significantly. Gross profit surged 60% to Rs. 1.64 billion in Q4 FY2024, and gross margins improved to 9.2% from 8.3% the previous year.
According to the Pakistan Automotive Manufacturers Association (PAMA), car sales in Pakistan surged by 69% in December 2024. A total of 9,820 units were sold, showcasing strong consumer demand for vehicles.
Cost Control and Financial Adjustments
While administrative expenses increased by 15%, reaching Rs. 457.3 million, Honda Pakistan succeeded in reducing finance costs. Finance costs dropped 52% to Rs. 214.9 million, compared to Rs. 443.2 million last year.
Other income, however, declined by 34%, falling to Rs. 189.9 million from Rs. 288.2 million. Despite this, Honda benefited from Rs. 109 million under levies during the quarter, bolstering its financial position.
Background of Honda Pakistan
Honda Pakistan began operations in 1994 as a joint venture between Honda Motor Co., Ltd. (Japan) and the Atlas Group of Companies (Pakistan). Since its inception, it has maintained a strong presence in the country’s automotive market.
In Q4 FY2024, Honda reported a Profit Before Taxation (PBT) of Rs. 1.1 billion, a 387% YoY increase. This result highlights the company’s ability to enhance sales and maintain cost efficiency even in a competitive environment.
Key Highlights
- Honda Pakistan’s profit surge hit 300%, reaching Rs. 566 million.
- Revenue increased 44% to Rs. 17.85 billion.
- December 2024 car sales rose by 69%.
- Finance costs dropped by 52%.
- Honda Pakistan’s profit surge reflects its strategic approach, effective cost management, and robust sales performance, setting a strong foundation for the future.
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