Kot Addu Power registers 4.1 percent growth in profit

KARACHI: Kot Addu Power Company (Kapco) posted 4.1 percent growth in its profit for the year ended June 30, 2017, a little above market expectations.

Kapco posted a net profit of Rs9.447 billion, translating into the earnings per share (EPS) of Rs10.73 for the outgoing fiscal year as compared to the profit of Rs9.071 billion and EPS of Rs10.31 during the previous year.

The company also announced a final cash dividend of Rs4.75/share, which is in addition to the interim dividend of Rs4.3/share already paid to the shareholders. The sales revenue during FY17 stood at Rs81.846 billion, up 27.5 percent from Rs64.178 billion in FY16.

“The rise is attributed to higher FO prices (29 percent) and higher generation (14 percent) during the year,” Tahir Abbas said in a report issued by Arif Habib Limited. The finance cost surged 36.7 percent to Rs4.424 billion during FY17, which analyst Rao Amir at Arif Habib Limited attributed to higher reliance on short-term borrowings. 

“Capacity utilisation for FY17 clocked in at 62.4 percent vis-à-vis 55.8 percent for FY16. While utilisation on high-speed diesel (HSD) continues to remain minute, generation on low sulphur furnace oil (LSFO) has come down from 81.6 percent to 67 percent of total generation, leading to lower plant tariff,” a report issued by Elixir Securities said.

Meanwhile, the independent power producer surged 2.5 percent at the local bourse on Tuesday.

Service’s profit drops 40 percent 

Net income of Service Industries Limited fell 40 percent to Rs424.230 million for the half year ended June 30, translating into earning per share (EPS) of Rs35.27, a bourse filing said on Tuesday.   Service recorded profit of Rs708.931 million with EPS of Rs58.94 during the corresponding period a year earlier, said a notice issued to Pakistan Stock Exchange. 

The company announced an interim cash dividend of Rs10 per share.

Service’s revenue dropped 6.6 percent to Rs10.214 billion during the six-month period of 2017. Cost of sales amounting to Rs8.470 billion was the major drag on the revenue, while operating expenses, including distribution cost and administrative expenditures also increased during the period under review.  The company, however, would enter into manufacturing of tyres for tractors to bolster revenue and revive profitability.

“In order to explore further opportunities in the businesses of tyres, the board of directors… decided to expand the business to include manufacture and sales of tyres of agriculture tractors with the brand name of Servis,” the company’s notice said. “This is expected to increase the revenue and profitability of the company which is in line with the company’s commitment to enhance the shareholder value.”

Service’s profit decreased 68 percent year-on-year to Rs143.417 million in the second quarter (Apr-Jun), translating into EPS of Rs11.92.  The company registered net income of Rs457.257 million in the same quarter a year ago.  Its revenue slightly fell to Rs5.110 billion in the three-month period ended June 30 from Rs5.323 billion in the similar period a year ago.        

Nestlé records 10pc top-line growth

Nestlé Pakistan recorded a positive first half, posting a growth of 10 percent and an overall increase in its total revenue by Rs5.64 billion.

The company reported overall earnings of Rs7.93 billion for the six months ended June 30, 2017 as compared to Rs6.42 billion during the corresponding period of the last year. The company said it is the result of optimisation of its value chain and continuous improvement in the product mix.

The results were announced upon the conclusion of the meeting of Nestlé Pakistan’s board of directors. In continuation with its positive financial performance in 2016, Nestlé Pakistan, the Pakistani subsidiary of the world’s largest food and beverage company, posted its results for the first half of 2017. Nestlé Pakistan’s earnings per share increased to Rs174.95/share from Rs141.58 /share during the same period of the last year. In the area of sales, the revenue of Nestlé Pakistan stood at Rs61.94 billion.