HBL earnings fall short of expectations

October 16, 2024 (MLN): Habib Bank Limited's (HBL) earnings for the quarter ended September 2024 fell short of market expectations, reporting a profit after tax worth Rs14.2 billion. That translates to earnings per share of Rs9.85 against market forecasts of Rs10.99.

The dividend payout of Rs4 per share met market expectations.

Earnings were 14.75% lower than the same period last year when the company recorded a profit after tax of Rs16.63bn [EPS: Rs11.34].

The year-over-year decline in profit was largely led by a substantial rise in Credit loss allowance and write-offs which surged to Rs8.93bn during the quarter from Rs1.43bn in SPLY.

Going by the income statement, the bank's net interest income dropped to Rs63.72bn in Q3 CY24, reflecting a decline of 1.95% compared to SPLY.

This drop was largely offset as the bank’s non-markup income spiked by 62.54% to Rs21.18bn.

The rise in non-markup income comes due to improved and expanded economic activity and customer base in the country.

On the expense side, the total non-markup expenses increased by 7.62% YoY to Rs48bn in Q3 CY24.

The increase was attributed to a substantial rise in the bank’s operating expenses.

On the tax front, the bank paid Rs13.83bn, 10.12% lower than the amount paid in Q3 CY23.

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