Nishat Mills gives no dividend

Nishat Mills announced no payouts to the shareholders despite depicting a growth of eight per cent in its net income that surged to Rs875 million (EPS: Rs5.48) for the current fiscal year’s first half ending December 31, 2006 from Rs811 million (EPS: Rs5.08) registered during the same period last year.

Although the overall textile sector exports exhibited a sluggish trend Nishat Mills exports continued to grow consistently posting an eight per cent growth over the corresponding period last year, said Farhan Aziz of JS Research.

However, the gross margins are squeezed by 100bps, owing to the higher cotton prices during the period under consideration, thereby resulting in meagre one per cent growth in gross profit. Moreover, increase in Admin & Dist. expenses resulted in 12 per cent decline in operating profits. On the other hand, other income of the company helped in improving net profitability.

Other income of Nishat continued to post healthy growth of 88 per cent due to its exposure in group companies i.e. MCB Bank and DG Khan Cement. MCB Bank and DG Khan Cement have declared dividends of Rs4 and Rs1.5 per share, which is supposed to be realized by Nishat in second quarter of the fiscal year 2007, he added.

Source: The News