FFC: Removal of GIDC expands margins

MG News | July 27, 2020 at 12:57 PM GMT+05:00

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July 27, 2020 (MLN): Fauji Fertilizer Company Limited (FFC) has disclosed its financial results for the six months ended June 30, 2020 wherein the company has posted a consolidated profit after tax of Rs 9.785 billion, showing a growth of 13.7% YoY against net profits of Rs 8.607 billion in the same period of last year.

This has translated into earnings per share which clocked in at Rs 7.69 against Rs 6.77 in the aforementioned period.

The rise in net profitability is a result of increased gross margins which expanded from 33% to 36% because of the lower cost of sales, down by 8.4%, due to the removal of GIDC.

During the period under review, the sales revenue dipped by 4% YoY to Rs 46.56 billion due to a decline in urea prices.

As per the financial statement issued by the company, some of the positive highlights include a 16% increase in other income and 62 times YoY increase in the share of profits from associated companies while financial charges of the company remained flat to Rs 1.497 billion.

Alongside financial results, the Board of Directors of the company announced an interim cash dividend for the half-year ended June 30, 2020 at Rs 2.75 per share i.e. 27.50%. This is in addition to interim dividend already paid at Rs 2.50 per share i.e. 25%

Consolidated Profit and Loss Account for the half-year ended June 30, 2020 ('000 Rupees)
	Jun-20	Jun-19	% Change
Turnover - net	46,561,145	48,544,993	-4.1%
Cost of sales	29,863,481	32,613,382	-8.4%
Gross Profit	16,697,664	15,931,611	4.8%
Administrative expenses and distribution cost	4,117,758	4,035,920	2.0%
Finance cost	1,497,766	1,494,624	0.2%
Other expenses	1,195,272	1,170,929	2.1%
Total expenses	6,810,796	6,701,473	1.6%
Other income	2,971,093	2,558,847	16.1%
Share of profit of associates and joint venture	547,196	8,694	6193.9%
Profit before taxation	13,405,157	11,797,679	13.6%
Provision of taxation	3,620,064	3,190,659	13.5%
Profit after taxation	9,785,093	8,607,020	13.7%
Earnings per share - basic and diluted (Rupees)	7.69	6.77	13.6%

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