August 4, 2021: The Pakistan Credit Rating Agency Limited (PACRA) has maintained ratings of Fauji Fertilizer Company Limited (FFC) at ‘AA+’ for the long term and ‘A1+’ for the short term with a stable outlook, reflecting the dynamic business profile and robust the financial position of the company while incorporating the derived strength from Fauji Foundation (FF).
According to the press release issued by PACRA, the Company's strong business footprint has enabled it to build 'Sona' a household name in the farming community, in Pakistan. The production facilities are secured by a dedicated and uninterrupted gas supply line from the Mari fields. This ensures sustainable business volumes for the Company.
FFC has continued to post the highest production levels and a strong top-line. Moreover, the Company has maintained a growth trajectory in margins and profitability. Stable dividend and interest income further enhance the Company's bottom line.
The Company has a moderately leveraged capital structure with very strong coverages and significant liquidity depicting a robust financial profile. The rating factor in FFC's strong organizational structure is designed to control its subsidiaries' strategic direction and strong governance framework.
The ratings are dependent on the sustainability of operations and maintaining its market share. Sustainability in the performance of subsidiaries, stable dividends, and effective management of financial profile is important.
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