Hubco’s annual profit drops

KARACHI: Net income of Hub Power Company (HUBC) dropped 9.2 percent year-on-year to Rs11.348 billion for the year ended June 30, 2017, translating into earnings per share (EPS) of Rs9.24, a bourse filing said on Thursday. 

Hubco recorded a net profit of Rs12.5 billion in the previous fiscal year with EPS of Rs10.29, said a notice issued to Pakistan Stock Exchange.  Analyst Mehwish Zafar at JS Global Capital said higher maintenance expenditures due to overhauling activity at Narowal plant led to lower profitability.

The company also announced a final cash dividend of Rs2.5/share, which is in addition to interim dividend of Rs5/share already paid to the shareholders. Analyst Syavash Pahore at Elixir Securities said full-year dividends are down 32 percent as the company sped up equity injections into its associated ventures China Power Hub Power Company and Thar Energy Limited. 

“Lower dividends could continue going forward as the company requires nearly $300 million for equity injection into above mentioned projects,” Pahore added.  Hubco’s revenue increased 10.46 percent year-on-year to Rs101.188 billion during the last fiscal year. Gross profit, however, decreased 7.15 percent to Rs17.259 billion due to higher fuel oil prices.