Karachi, Lucky Cement Limited (LUCK) disclosed its financial results for the third quarter of fiscal year 2024, indicating a noticeable decline in profitability due to contracting gross margins and decreased cement sales.

According to AKD Securities Limited, the company's unconsolidated earnings decreased by 27% from the previous quarter, totaling PKR 4.9 billion, with earnings per share dropping to PKR 16.9.

The company's gross margins narrowed significantly from 36.0% to 28.8% over the quarter, attributed to several factors including higher coal prices, increased power costs due to gas price adjustments, and a shift in sales composition favoring clinker exports. Furthermore, cement sales volumes saw a 10% quarterly decline, impacting the overall revenue, which fell to PKR 27.5 billion.

Other income for Lucky Cement also decreased by 6% quarterly but increased significantly year-over-year by 84%, bolstered by higher interest rates and increased dividends from its investment in Lucky Cement Investments (LCI). On a consolidated basis, the company reported earnings of PKR 53.2 per share for the quarter, which aligns with market expectations.

Despite the quarterly downturn, Lucky Cement's earnings over the first nine months of fiscal 2024 grew by 67% compared to the same period last year, primarily driven by higher gross margins and increased other income.