April 23, 2020 (MLN): Engro Corporation Limited (ENGRO) has declared its financial results for the 1st quarter ended March 31, 2020, as per which the company has reported a profit of Rs 5.94 billion i.e. 9.5% lower than net profits of Rs 6.56 billion of the corresponding period last year.
The company has also announced an interim cash dividend of Rs 6 per share i.e. 60% for the 1QCY20.
The decline in profitability of the company was mainly attributable to a drop in EFERTs’ net profits followed a decline in net profits of EPCL, as per research note of Ismail Iqbal securities.
However, EPQL posted an increase in net profits which supported the overall earnings of ENGRO.
The company’s gross profits increased by 14.3% YoY due to the increase in sales revenue despite a 9.12% increase in the cost of sales, restricting gross margins from 30% to 31%.
On the expense front, distribution and selling cost of the company dipped by 39% YoY while the company bore other operating charges which hiked to Rs 1.74 billion i.e. 2.5 times higher than the same period of last year which nullified the impact of increased in other income (up by 47%).
The finance cost soared by 4 times YoY, from Rs 1.51 billion to Rs 6.06 billion due to a substantial increase in interest rate, foreign exchange loss booked by EFERT, and higher interest expense from Thar power, resulting in weakening bottom-line, revealed research of Ismail securities.
ENGRO’s basic and diluted earnings per share have been reported at Rs 5.76 per share while those recorded last year were Rs 6.96 per share.
|
Consolidated Financial Results for the 1st Quarter Ended March 31st, 2020 ('000 Rupees) |
|||
|---|---|---|---|
|
|
Mar-20 |
Mar-19 |
% Change |
|
Revenue |
44,977,167 |
40,647,358 |
10.65% |
|
Cost of Sales |
(31,257,355) |
(28,645,147) |
9.12% |
|
Gross Profit |
13,719,812 |
12,002,211 |
14.31% |
|
Selling and distribution expenses |
(1,056,718) |
(1,740,448) |
-39.28% |
|
Administrative expenses |
(1,508,526) |
(1,344,168) |
12.23% |
|
Other income |
3,443,075 |
2,347,832 |
46.65% |
|
Other operating expenses |
(1,747,111) |
(701,896) |
148.91% |
|
Operating profit |
12,850,532 |
10,563,531 |
21.65% |
|
Finance cost |
(6,066,385) |
(1,515,108) |
300.39% |
|
Share of income from joint ventures & associates |
270,316 |
409,732 |
-34.03% |
|
Profit before taxation |
7,054,463 |
9,458,155 |
-25.41% |
|
Taxation |
(1,113,623) |
(2,893,228) |
-61.51% |
|
Profit after taxation |
5,940,840 |
6,564,927 |
-9.51% |
|
Earnings per share – basic and diluted (Rupees) |
5.76 |
6.96 |
-17.24% |
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