Bahrain Trafco Groups nine-month earnings hit $3.45mln

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MANAMA: Trafco Group has reported net profit of BD241,000 during the third quarter this year, a decrease of 37 per cent when compared with BD380,000 during the same period last year.

Total comprehensive income saw an increase of 9pc to BD675,000 from BD622,000 earlier.

Operating profit (including minority shares) was BD546,000, a decrease of 12pc when compared with BD622,000.

The group’s revenue saw a decrease of 4pc from BD9.6 million to BD9.2m.

Earnings per share were three fils compared with five fils.

For the nine months, the group achieved a net profit of BD1.3m compared with BD1.62m in the previous year, with a decrease of 20pc.

Total comprehensive income during the nine months of BD2.73m saw an increase of 53pc from BD1.79m last year.

Operating profit (including minority shares) during the nine months was BD1.48m compared with BD1.93m last year, with a decrease of 23pc.

The group’s revenue for the nine months was BD28.5m, a decrease of 4pc compared with BD29.7m last year.

Earnings per share were 17 fils compared with 21 fils last year.

Total shareholders’ equity (excluding minority interests) for the nine months was BD26.2m compared with BD25.6m last year, an increase of 2.3pc.

Total assets for the nine months saw an increase of 12.5pc to BD45m compared with BD40m last year.

Trafco Group chairman Ebrahim Zainal said though there was 5pc growth in gross profit during the quarter, revenue dropped due to overall decrease in the selling prices compared with the same period last year.

The decrease in the net profit can be attributed to increased selling and distribution expenses cost and depreciation.

In addition, the new IFRS accounting standard on leases had an impact on the presentation of P&L account.

Group chief executive S Sridhar said the drop in net profit was due to general decline in the market resulting in overall drop of profitability of the parent and subsidiary companies with increased cost of raw materials, fuel and energy leading to higher production cost.

A new asset in the balance sheet ‘right-of-use’ is created as per the IFRS requirements reflecting the present value future lease rentals and notional depreciation is charged on this asset in addition to the existing assets.

Overall depreciation this year is higher than last year by around BD329,000 impacting the net profit.

As per new IFRS requirements, the group chose the option of accounting the profit on sale of investments under other comprehensive income as against the practice of taking the same to statement of income, which otherwise would have increased the earning per share.

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