In relation to the Chemicals Business, the Board of Directors of Imperial Chemical Industries (ICI) Pakistan Limited, during its meeting, approved a proposal to establish a facility to manufacture Masterbatch, used in the colouring/pigmentation of various plastics (PE, PP, PVC).
“The estimated project cost is Rs 590 million and is expected to come online in the first quarter of 2019. The proposed facility will be situated at the Company’s premises at 5 West Wharf, Karachi. This project is another strategic step towards fulfilling the Company’s growth aspirations by enhancing the product portfolio of its Chemicals Business,” said a statement issued here on Monday.
ICI Pakistan Limited has also announced the company’s annual financial results for the year ended June 30, 2017.
Unconsolidated profit after tax for the year at Rs 3,296 million is 16 percent higher compared to the same period last year (SPLY). Earnings per share (EPS) at Rs 35.69 are correspondingly 16 percent higher than the SPLY. This robust growth in net profit is attributable to higher operating profit, higher Dividend Income from Associate and lower exchange losses as compared to the prior year.
Operating profit for the year at Rs 4,044 million is 16 percent higher than the SPLY, with improved performances in the Polyester, Life Sciences and Chemicals Businesses.
Net turnover at Rs 41,364 million is 12 percent above net sales for the year ended June 30, 2016, which were recorded at Rs 36,954 million. The increase in sales revenue across all Businesses contributed to this performance. The Polyester Business revenue growth of 7 percent was due to higher prices across the petrochemical chain, higher average Polyester Staple Fibre selling prices and increased sales of premium Black Fibre.
Soda Ash net turnover grew by 2 percent on account of higher volumes, with Life Sciences recording a 28 percent growth in net turnover on the back of new product launches and growth of the existing portfolio. Net turnover for the Chemicals Business grew by 20 percent against the SPLY, owing to higher sales volumes and an expanding customer base.
Chief Executive ICI Pakistan Limited, Asif Jooma, shared his view on the completion of another eventful year saying, “The year 2016-17 has seen us Cultivating Growth in exciting new ways. Milestone expansions, partnerships and innovative approaches to doing business have all contributed to the successes achieved by the Company.”
“As we near 70 years of Pakistan’s independence, we maintain our singular commitment to our core values whilst contributing to the homeland where we have grown and evolved for over seven decades. We intend to continue delivering on our growth aspirations for a brighter shared future,” he said.
The Chief Executive’s comment references key developments from FY 2016-17. The Life Sciences Business significantly expanded its product portfolio and enhanced its manufacturing capabilities with two key acquisitions; Cirin Pharmaceuticals (Private) Limited and certain Wyeth Pakistan Limited-owned assets (the latter will follow completion of regulatory formalities).
It also refers to the execution of a shareholders’ agreement for the establishment of a state-of- the-art facility to manufacture Morinaga infant formula products along with distribution, marketing and sales of these products. This project is in process under a newly incorporated subsidiary, NutriCo Morinaga (Private) Limited, in which ICI Pakistan Limited has a majority shareholding of 51 percent.
On a consolidated basis, including the results of the Company’s subsidiaries, ICI Pakistan PowerGen Limited, Cirin Pharmaceuticals (Private) Limited and NutriCo Morinaga (Private) Limited, profit after tax (PAT) for the year at Rs 3,280 million or Rs 35.54 EPS is 20 percent higher than the SPLY. During the year, the Company recognized Rs 671 million as share of profit from NutriCo Pakistan (Private) Limited.
The future outlook remains promising with several factors expected to foster a positive atmosphere for investment growth in the country, such as China Pakistan Economic Corridor (CPEC) related power and infrastructure projects, stable inflation and interest rates, and continuing progress in energy supply and availability.
This positive atmosphere will enable the Company to develop and expand further. Effective cost management and introduction of new product variants should mitigate the continuing pressure on margins in the Polyester Business. Capacity expansion projects in the Soda Ash Business will position the Company to meet the growing demand of its customers. The outlook and growth for the Life Sciences Business also remains positive.
The Board of Directors has recommended the Final Cash Dividend in respect of the financial year ended June 30, 2017 at the rate of 100 percent i.e. Rs 10 per share of Rs 10 each. This is in addition to the 80 percent Interim Cash Dividend (i.e. Rs 8 per share) already paid, as recommended by the Board of Directors.