February 8, 2019 (MLN): Engro Fertilizer (EFERT) has recorded a 56% rise in annual net income for the period ended December 2018, marking the figure at Rs.17.4 billion and EPS at Rs.13.04.
The anticipated rise in profitability can evidently be attributed to higher sales of Urea and DAP (+11% and +12%, YoY in CY18) -two of the main products- as well as improved pricing of the two.
While this result remains in line with the general forecast, the brokerage houses that made the closest projections were Ismail Iqbal Securities and AKD Securities.
Due to improved sales and higher pricing of Urea and DAP as mentioned above, EFERT’s topline (Rs.109.2 billion) grew by 41.6% during the year.
Coupled with a limited rise in cost on account of concessional feed gas, this pushed up gross profit by 52%, YoY.
Although as per market expectation, non-core income has declined by 64% due to reduction and later discontinuation of subsidy on urea during the year, as well as because of replacement of DAP subsidy with lower GST rate from 2HCY17 onwards.
Even so, the company managed to make it through with substantial gains on its back.
The Board of Directors have also recommended a final cash dividend at Rs.3 per share that is 30%. This is in addition to interim cash dividends already paid at Rs.8 per share that is 80%.
|
Consolidated Financial Results for the Year Ended December 31st 2018 ('000 Rupees) |
|||
|---|---|---|---|
|
|
Dec-18 |
Dec-17 |
% Change |
|
Net Sales |
109,196,586 |
77,129,343 |
41.58% |
|
Cost of Sales |
(73,880,139) |
(53,910,755) |
37.04% |
|
Gross Profit |
35,316,447 |
23,218,588 |
52.10% |
|
Selling and Distribution Expenses |
(8,007,915) |
(7,244,739) |
10.53% |
|
Administrative Expenses |
(1,585,426) |
(1,292,798) |
22.64% |
|
Other Income |
2,061,954 |
5,865,860 |
-64.85% |
|
Other Operating Expenses |
(1,431,926) |
(1,234,367) |
16.00% |
|
Finance Cost |
(2,070,933) |
(2,647,774) |
-21.79% |
|
Profit before Taxation |
24,282,201 |
16,664,770 |
45.71% |
|
Taxation |
(6,868,683) |
(5,509,148) |
24.68% |
|
Profit after Taxation |
17,413,518 |
11,155,622 |
56.10% |
|
Earnings per share – basic and diluted |
13.04 |
8.36 |
55.98% |
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