FFC's earnings surge almost three times to Rs15.5bn

July 30, 2024 (MLN): Fauji Fertilizer Company Limited's (PSX: FFC) earnings jumped 190.7% YoY in the second quarter of 2024, with its profit after tax surging to Rs15.55 billion [EPS: Rs12.22].

This compares with a profit of Rs5.35bn [EPS: Rs4.2] in the same period last year (SPLY).

Along with the results, the company announced an interim cash dividend of Rs10 per share.

This is in addition to the interim dividend already paid at Rs5.5 during the year.

The company has started selling its products through company-owned stores/outlets thus providing farmers a channel to buy directly from the company, it said in as tock filing on Tuesday.

Investment in this channel will benefit farmers across the country as approximately 70 such outlets are being opened in all sales districts and shall be operational by end of third quarter of 2024.

FFC"s plants delivered 1,279 thousand tonnes of sona urea operating at improved efficiencies.

The company also exercised cost optimization measures which enabled improved returns for the shareholders.

Sona urea sales stood at 1,280 thousand tonnes, 3% higher than in 2023.

The company also marketed 94 thousand tonnes of urea imported by the government of Pakistan and the aggregate urea sales thus stood at 1,374 thousand tonnes.

As a result, FFC's urea market share also improved to 46% compared to 40% during same period last year.

Going by the results, the company's top line grew by 60.8% YoY to Rs57.17bn as compared to Rs35.55bn in SPLY.

The cost of sales rose by 37.8% YoY but was lesser than proportionate to sales rise, which improved the gross profit by 87.0% YoY to Rs31.13bn in Q2 2024.

The gross margins improved to 54.5% as compared to 46.8% in SPLY.

During the period under review, other income grew 99.8% YoY to stand at Rs5.49bn in Q2 2024 as compared to Rs2.75bn in SPLY.

On the expense side, the company's administrative expenses rose YoY to Rs0m, selling and distribution expenses rose 106.7% YoY to Rs5.54bn, and other operating expenses rose 106.7% YoY to Rs2.56bn.

The company’s finance cost surged by 15.7% YoY and stood at Rs1.38bn as compared to Rs1.19bn in SPLY, mainly due to higher interest rates.

On the tax front, the company paid a higher tax worth Rs11.6bn against the Rs8.37bn paid in the corresponding period of last year, depicting an increase of 38.6% YoY.

Amount in thousand except for EPS

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