Auditors flag non – compliance despite robust financial position
Proplastics, a company operating within the plastics industry, seems to be in a robust financial position, showcasing growth across various key metrics including revenue, profitability and equity.
The company has adopted a cautious approach to debt management and cash handling, indicating prudent financial stewardship.
However, a recent audit report issued by KPMG has flagged non-compliance with specific International Accounting Standards in the preceding year, potentially affecting the comparability of financial performance.
While this warrants attention, it underscores the necessity for future evaluations of the company’s financial health to consider the impact of previous non-compliance.
In a move to bolster liquidity, Proplastics has opted against declaring a final dividend, emphasising its commitment to sound financial management practices.
Key financial highlights for the year ended December 31, 2023, include a notable 22 percent increase in turnover, reaching US$21,3 million from US$17,4 million in the previous year.
“This growth signifies heightened sales activity and heightened market demand. Additionally, export sales experienced a remarkable surge of 102 percent, contributing 11 percent to the overall sales figure, reflecting the company’s successful expansion into new markets,” the company said in a trading update.
Net profit soared by 216.06 percent to US$519,877 in 2023, compared to US$164,482 in 2022, underlining the company’s profitability. The gross profit for the year amounted to US$6,41 million, with a gross profit margin of approximately 30 percent.
Despite a slight decrease in gross profit margin, Proplastics exhibited an improvement in both profit before tax and net profit compared to the previous year, indicating efficient cost management and operational optimisation.
The company added; “The company’s conservative approach to debt financing is evident in its low gearing ratio of 1,5 percent, mitigating financial risk.”
Administrative expenses saw a decline of 10,21 percent to US$3,91 million from US$4,36 million in the comparative period, further highlighting cost-efficiency measures.
Proplastics’ total equity surged to US$13,73 million, underscoring its financial robustness and stability.
Moreover, the company managed to reduce its total current liabilities to US$6,22 million, down from US$8,89 million in the previous year. This reduction signals a positive trajectory in handling short-term obligations and fortifying its financial position.-chronicle
