FCEPL: Growth journey continues

August 20, 2021 (MLN): FrieslandCampina Engro Pakistan Limited (FCEPL) (previously Engro Foods Limited) continued its growth journey as it posted net profits of Rs1.4mn for the half-year ended June 30, 2021, which was 4.8x higher than the profits of Rs413,017 reported in the corresponding period last year.

The revenues of the company jumped by 22% YoY or Rs4.4mn to Rs24.6mn led by strong volumetric growth in all categories – particularly Olpers, complemented by strong marketing campaigns on conversion awareness, while the cost environment remained challenging due to a sharp increase in commodity costs. Nonetheless, Company managed to offset these challenges by taking few initiatives, including cost optimization and mix management.

As a result, the Gross margin improved by 3.5ppt to 20.7% versus 17.2% reported last year.

With regards to major expense heads, the company saw a slight increase of 5% and 15% in admin and distribution costs as it continued to drive efficiencies in distribution and administrative expenses through multiple savings initiatives.

Meanwhile, the company’s other operating expenses surged by 2.5x YoY compared to the same period of the last year. This was counterbalanced by a 46.4% YoY reduction in finance cost amid a lower interest rate regime.

Consequently, the Company registered a profit after tax of a Rs1.4million versus a loss of Rs413,017 in the same period last year.

As per the financial statement, the company paid an income tax of Rs566,779 as opposed to the tax of Rs120,411 that the company paid in the same period last year.

Copyright Mettis Link News