Pakistan Aluminium Beverage Cans (PABC) has announced a plan to increase its production capacity in response to a significant surge in demand for aluminium cans. The company has achieved an impressive utilization rate of 88% in 2022, which marks a noteworthy increase from the previous year's rate of 78%.
Currently, PABC has an annual capacity of 950 million cans, but it is aiming to increase it further to 1.2 billion cans in the near future. The expansion is expected to be completed by August 2023, which will allow PABC to meet the growing demands of its consumers.
In a recent corporate briefing, the company posted that in FY20, its portion of exports in total sales was almost 39%, which dropped to 37% in FY21. JS Global analyst Waqas Ghani Kukaswadia mentioned that it heightened to 42% in FY22.
PABC's management also seconded this narrative by claiming that all the necessary machinery required for the expansion had already been procured. Kukaswadia exclaimed: "The primary objective of the expansion is to meet the growing consumer demand for aluminium cans, and it is expected to be completed by August 2023."
Despite facing economic challenges, the company has maintained an impressive growth trajectory, with its revenue reaching PKR 14.2 billion in 2022, indicating a year-on-year increase of 96%. Although there was a decrease in gross profit margins, the company's after-tax profit stood at PKR 2.7 billion in 2022, marking an impressive year-on-year rise of 71%.
Furthermore, PABC's net profit in the first quarter of 2023 was PKR 1.3 billion, which highlights the company's continued strong growth momentum. PABC projects a sales volume of 750 million cans in FY23, with a calculated income of PKR 18 billion and a net profit of PKR 3.5 billion.
The management has made it known that PABC can certainly augment its production capacity to about 2.5 billion cans per year at its prevailing unit in Faisalabad. A cash margin of 100% wouldn't be required for raw materials because the supply chain has been eased.
Overall, PABC's expansion plans and its continued growth demonstrate the company's commitment to meeting the demands of its consumers and maintaining its position as a leading player in the industry.
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