Muskita lifts 9M06 profits by 24%

Muskita Aluminium Industries Plc (MAI) reported a highly satisfactory 24.3% YoY increase in net profits to CYP 3.99 mln or EUR 6.9 mln compared to CYP 3.2 mln  a year ago in the same period on the back of higher sales and its ability to control costs.

MAI’s turnover increased by 21.0% YoY to CYP 25.45 mln or EUR 44 mln, mainly attributed to higher local sales (+16.8% YoY to CYP 15.49 mln) on the back of the strong local real estate sector. The contribution of local sales to total sales remained at high levels and hovers at 60.8% compared to 63.0% in 9M05. European export sales reached CYP 9.76 mln compared to CYP 7.74 mln in 9M05 (+26.1% YoY).

Muskita’s gross profit advanced by 17.4% YoY to CYP 8.05 mln. Gross profit margin fell from 35% in 9M05 to 31.6% in 9M06 as raw material costs increased and production costs also jumped.

Total expenses advanced by 23.4% YoY to CYP 3.77 mln stemming from higher payroll budget and energy costs. In terms of turnover, total expenses were contained from 14.6% in 1H05 to 14.8%.

The bottom line was positively affected by a reversal in net finance charge of

CYP 181k in 9M05 to a net income of CYP 151k due to the positive impact from a reversal in FX adjustments (+CYP 298k YoY).

Net Profit surged by 24.3% YoY to CYP 3.99 mln or EUR 6.9 mln and close to the full 2005 profit of CYP 4.6 mln. EPS improved to CYP 4.84 cent or EUR 8.36 cent vs. CYP 0.0389 in 9M05.

Management insists that the company’s results will not be affected as a result of the law suit that the Muskita lost with respect to a share price fixing allegations related to a takeover in 2000 before the company was listed. Any losses from the law suit in case the appeal is lost will be paid by the majority shareholder family.

Shareholders funds increased to CYP 33 mln or EUR 57 mln, helping lift book value to EUR 0.70 per share according to Financial Mirror calculations while cash balances increased to CYP 3.3 mln.