EPCL’s profits plummet by 25% in CY19

February 4, 2020 (MLN): Engro Polymer and Chemical Limited has declared earnings of Rs. 3.69 billion for the year ended December 31, 2019, i.e. nearly 25.03% lower than last year. The Earnings per share of the company stood at Rs. 4.07, which is 34.57% lower than the EPS of previous year.

The company also announced a Final Cash Dividend for the year at Rs. 0.2 per share, i.e. 2%. This is in addition to interim Cash Dividend already paid at Rs. 0.6 per share i.e. 6%.

According to the financial report sent to the Pakistan Stock Exchange, the topline-income and cost of sales of the company grew by the same margin. This, however, resulted in a 6.5% increase in gross profits.

Other major highlights from the report included a 50% increase non-core expenses, and a 1.96x surge in finance costs.  These adverse movements led to the PBIT decreasing by almost 22%.

Earlier in January, the Board of Directors of the company had resolved to issue Preference Shares to individuals, companies, body corporates, commercial banks, DFIs, financial institutions, mutual funds, provident / pension / gratuity funds / trusts, etc., by way of pre-IPO placements and public offering, at a price of Rs. 10 each, aggregating up to Rs. 3 billion.

The proceeds of the Preference Shares, according to the Board, shall be primarily utilized to expand the Company’s Poly-Vinyl-Chloride capacity and debottlenecking of Vinyl Chloride Monomer production capacity without increasing leverage, with the intention of obtaining tax credits under the applicable laws.

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