April 19, 2022 (MLN): Engro Polymer and Chemicals Ltd (EPCL) has unveiled its 1QCY22 results wherein it posted net profits of Rs4.71 billion (EPS Rs5.19), depicting an increase of around 14% YoY when compared to Rs4.14bn (EPS Rs4.56) in 1QCY21.
In conjunction with financial results, the company announced a higher-than-expected final cash dividend of Rs5 per share i.e, 50% for ordinary shareholders, while the preference shareholders will be paid Rs0.37 per share i.e, 3.7%.
The company’s net revenue grew by 47.57%YoY to Rs23.12bn due to higher better volumetric sales. However, gross margins have been squeezed to 33.14% compared to 39.79% in 1QCY21on the back of lower premium on domestic PVC sales during the quarter despite international PVC-Ethylene margin trading at levels (US$815/ton in 1QCY22) similar to last year, a research note by Sherman Securities highlighted.
On the expense front, the distribution and marketing expenses surged by 63.87% YoY, administrative cost by 37.56% YoY and other expenses by 7x YoY during 1QCY22 due to exchange losses.
Meanwhile, the finance cost moved up by 52.4% YoY to clock in at Rs1.90bn on the back of monetary policy tightening.
On the other hand, the surge in company’s other income by 48% YoY to Rs432mn has supported bottom line of the company. Thanks to higher profitability and improved cash generation during the quarter.
Meanwhile, the effective tax rate for the said period improved to 24.65% against 27.86% in 1QCY21.
|
Consolidated Profit and Loss Account for the Quarter ended March 31, 2022 ('000 Rupees) |
|||
|---|---|---|---|
|
Mar-22 |
Mar-21 |
% Change |
|
|
Net revenue |
23,126,868 |
15,671,459 |
47.57% |
|
Cost of sales |
(15,462,360) |
(9,435,754) |
63.87% |
|
Gross profit |
7,664,508 |
6,235,705 |
22.91% |
|
Distribution and marketing expenses |
(150,334) |
(91,945) |
63.50% |
|
Administrative expenses |
(229,036) |
(166,504) |
37.56% |
|
Other operating expenses |
(848,195) |
(122,908) |
590.11% |
|
Other income |
432,312 |
291,211 |
48.45% |
|
Operating profit |
6,869,255 |
6,145,559 |
11.78% |
|
Finance cost |
(613,458) |
(402,507) |
52.41% |
|
Profit before taxation |
6,255,797 |
5,743,052 |
8.93% |
|
Taxation |
(1,542,214) |
(1,600,082) |
-3.62% |
|
Profit for the period |
4,713,583 |
4,142,970 |
13.77% |
|
Earnings per share – basic (Rupees) |
5.19 |
4.56 |
13.82% |
|
Earnings per share – diluted (Rupees) |
3.9 |
3.42 |
14.04% |
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