Muskita profit surge 25% in H106

Muskita Aluminium Industries Pcl (MAI) reported a strong increase in first half 2006 profit as major investments in state-of-the-art production facilities helped lift profit by 24.6% YoY on the back of higher sales and costs remaining under control.

Total turnover was up 18.7% YoY to CYP 17.2 mln from CYP 14.4 mln a year ago in the first half and CYP 29.2 mln in total profit for the whole of 2005, as the company maintained robust exports and local sales.

European export sales were up 12.5% YoY to CYP 6.09 mln compared to CYP 5.42 mln a year ago in the same period. Muskita’s gross profit advanced by 9.5% YoY to CYP 5.19 mln. Gross profit margin from local operations decreased significantly from 35.1% to 31.9% in 1H06 mainly due to the increase in the average cost of primary aluminium from USD 1,844 per ton to USD 2,533 per ton in 1H06, as well as the higher energy costs and labour production costs as calculated by Egnatia Financial Services. Margins from European sales also deteriorated from 28.8% in 1H05 to 27.2. Overall, declining margins were primarily attributed to the increase in the average cost of primary aluminium (+37.3% YoY), as well as the higher energy and labour production costs.

EBITDA remained strong and rose by a satisfactory 9.2% YoY to CYP 3.83 mln, margins deteriorating from 24.2% in 1H05 to 22.2%. Total expenses advanced by 9.6% YoY to CYP 2.21 mln on the back of higher selling and distribution expenses (+12.8% YoY) stemming from higher payroll budget and energy costs. In terms of turnover, total expenses were contained from 14.3% in 1H05 to 13.1%.

The bottom line was positively affected by a reversal in net finance charge of CYP 160k in 1H05 to a net income of CYP 107k due to lower interest paid on loan facilities higher interest received on cash balances, and (3) a positive impact from a reversal in FX adjustments (+CYP 283k YoY). Net Profit surged by 24.6% YoY to CYP 2.79 mln from CYP 2.23 mln a year ago in the first half and CYP 4.61 mln for the whole of 2005. EPS were 3.38 cent vs. 2.71 cent in 1H05.