Systems Limited announced its financial results for the nine months ended September 30, 2024. The company reported a consolidated profit after tax (PAT) of Rs. 5,432 million, down 24 percent year-over-year (YoY) compared to Rs. 7,146 million in 9MCY23.
Despite the decline in overall profit, Systems Limited’s consolidated earnings for the third quarter of 2024 increased by 18 percent YoY to Rs. 2,188 million.
Net sales for 9MCY24 reached Rs. 48.3 billion, a 29 percent YoY increase. In 3QCY24, net sales grew by 22 percent YoY, driven by growth in dollarized revenue across all verticals.
Gross margins declined by 430 basis points (bps) YoY in 9MCY24 due to inflationary adjustments in compensation, rising energy costs, and a lower average exchange rate. In 3QCY24, gross margins decreased by 290bps YoY to 25 percent.
Administrative and distribution expenses rose by 15 percent year-over-year and 26 percent quarter-over-quarter in 3QCY24, likely due to inflationary pressures and an increase in the resource pool.
Other income for the quarter amounted to Rs. 186 million, up 4 percent YoY, primarily driven by interest income from subsidiaries and an increase in cash and cash equivalents.
Finance costs declined by 60 percent YoY and 30 percent quarter-over-quarter in 3QCY24, primarily due to lower short-term borrowings.
The company’s effective taxation rate for 3QCY24 was 9.9 percent, compared to 6.4 percent in the same period last year. This increase was primarily attributable to higher tax rates applicable in the UAE region.
