GB Auto’s full-year net income drops 46.7% on year

GB Auto reported on Wednesday net income came in at LE116 million, down 46.7 percent y-o-y.  The board of directors recommended withholding dividends for the for FY2013.
Beltone Financial says in a recent study, As expected, GB Auto posted a relatively weak set of results in FY2013.
GB Auto's revenues coming in at LE9,127 million in  FY2013, up 10.1 percent y-o-y from LE8,290 million. Gross profit came in at LE1,170 during the year, translating to a GPM margin of 12.8 percent versus 12.9 percent in FY2012.
"Overall, the weak results were due to poor 2Q2013 and 3Q2013 performance as a result of six factors: Hyundai’s pressured market share, which was offset by increased demand on Geely, a change in Iraqi regulations that impacted volumes and margins, weaker three-wheeler sales, which was expected on higher customs (GB Auto decided to absorb a portion of the customs hike to protect sales volume since this is a price-sensitive product), SG&A continuing to be pressured y-o-y by regional expansion, a trend that started in 1Q2013, high net financing costs, mainly related to its regional expansion, and macroeconomic challenges in Egypt and dampened consumer sentiment", Beltone Financial said.

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