Fauji Fertilizer’s H1 profit up 11pc

KARACHI: Fauji Fertilizer Company Limited’s (FFCL) profit for the six months ended June 30, 2020 went up 11 percent to Rs9.785 million, translating into an EPS of Rs7.69, a statement said on Monday.

Fauji Fertilizer earned Rs8.607 million with EPS of Rs6.77 in the corresponding period last year. The company announced interim cash dividend of Rs2.75/share, which is equivalent to 27.50 percent. This is in addition to the already paid interim cash dividend of Rs2.50/share, equivalent to 25 percent.

Brokerage Arif Habib Limited in a research report said: “Net sales declined 12 percent YoY during 2QCY20, clocking in at Rs23,156 million amid 10 percent and 5 percent YoY drop in urea and DAP prices, respectively, and 53 percent YoY fall in DAP offtake.”

Urea offtake witnessed a surge of 35 percent YoY during the 2QCY20. Similarly, in 1HCY20, topline declined by 6 percent YoY owed to 4 percent and 3 percent YoY fall in urea and DAP prices, respectively, followed by 48 percent YoY plunge in DAP offtake, the report said.

Gross margins clocked in at 31.95 percent (down 183bps YoY) in 2QCY20 on account of lower urea and DAP prices.

On a cumulative basis, gross margins settled at 34.01 percent in 1HCY20, compared with 31.84 percent in SPLY, on the back of lower effective gas prices during the period on account of reduction in GIDC.

Financial charges plummeted 27 percent YoY to Rs462 million in 2QCY20 due to lower borrowings. With this, total financial charges for 1HCY20 settled at Rs1,135 million, up 3 percent YoY.

Other income jumped up one percent YoY to Rs2,287 million, amid dividend income from associated companies. Hence, other income in 1HCY20, clocked in at Rs4,007 million, up one percent YoY.