Pakistan: Service Industries increase profits in 2001
Lahore-based footwear manufacturer Service Industries posted an impressive increase in profits for the year to December 31, 2001, according to the country’s annual report. After-tax profits rose to $1.12 million in 2001 from $0.51 million in 2000. The company manufactures and exports Service brand shoes in Pakistan.
Overall sales increased 15.7% to Rs 2324 million ($38.73 million) in 2001, with growth in both domestic and export markets across all product lines. Domestic sales of footwear increased 16.28%to Rs 1063.99 million ($17.73 million) in 2001 from Rs 915.04 million ($15.25 million) in 2000 while exports were up 16.38% to Rs 585.36 million.
Reviewing the results, chief executive Shahid Hussain, said he believed Pakistan had experienced the most difficult period of its existence following the terrorist attacks on the US on September 11. The subsequent military action in Afghanistan combined with increased tensions with India put a serious strain on Pakistan and resulted in a sharp decline of economic activities within the country. During the second half of 2001 freight and insurance costs increased significantly, adversely affecting both imports and exports.
Mr Hussain also expressed concern over the increasing imports of cheap shoes from China and the Far East, urging the government to take steps to maintain the competitiveness of domestic manufacturers.
