Yusuf Dewan Textile Mills Analysis

Editor's Notes

1. Excerpts from Directors Report 1.The textile spinning industry faced many challenges during the year under review. Textile spinning industry has been facing distressed and unfortunate set of circumstances which hampered the smooth operations of several units. The market has been undergoing through its bad time both domestically and internationally. Extensive load shedding and limited gas supply have adversely affected the production capacities of the industry. Moreover sluggish economic growth, deteriorating law & order situation coupled with increased cost of gas have made yarn prices uncompetitive in the market. In effect, many units in the sector are facing financial difficulties but have managed to remain in production to keep them afloat 2-Decrease in production volume, during the year, was the result of the said under utilization of plant capacity, which brought about lesser sales volumes. The decrease in gross margins was also resulted due to the increase in cost of various inputs. During the entire period raw material prices remained volatile which affected the cost of purchases, furthermore, the increase in gas prices and minimum wages have also pushed the cost of goods manufactured towards the higher side. Increased raw material prices did not reciprocate by the increase in yarn market prices which has also shrunk the gross margins.