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UBL profit declines 7.8pc to Rs4.656 billion in Q3

Business

October 27, 2020

KARACHI: United Bank Limited profit decline 7.8 percent to Rs4.656 billion in the third quarter ended September 30, 2020 translating into EPS of Rs3.86, a bourse filing said.

The bank earned Rs5.052 billion with EPS of Rs4.24 in the same quarter in 2019. It did not announce any interim cash for the quarter ended September 30, 2020. The first interim cash dividend had already been paid at Rs2.5/share, which was equivalent to 25 percent for the quarter ended March 31, 2020.

Topline Securities in its note said the result was in line with industry expectations. “However, net interest income came in higher than our expectations which was offset by higher than expected provisioning expenses.”

Net interest income was up 24 percent to Rs19.656 billion, from Rs15.871 billion in the same quarter last year. “Although the bank saw substantial 27 percent QoQ drop in interest expense, asset re-pricing resulted in lower interest earned by 19 percent QoQ.”

Fee and commission income fell 23 percent Rs3.049 billion from Rs3.954 billion in the same quarter last year; dividend income fell 28 percent to Rs112.680 million in the quarter under review from Rs144.874 million in the same period last year, whereas total non-mark up interest income fell 23 percent to Rs4.518 billion from Rs5.872 billion.

Operating expenses remained in check with provisions, easing 12 percent QoQ. The bank in a statement said it maintained its momentum across businesses, as gross revenues were recorded at Rs71 billion, up 14 percent. EPS stood at Rs13.13 for the nine-month period ended September 30, 2020.

UBL’s nine-month gross profit was Rs26.4 billion. The profit after tax stood at Rs16 billion with 12 percent growth over last year.

“The bank’s capital ratios remained strong with the overall Capital Adequecy Ration (CAR) at 22.8 percent as at September 30, 2020, well above the minimum regulatory requirement of 12.5 percent,” the statement added.

It also maintained leadership in the home remittances space with a market share of approximately 24 percent. “Over $6 billion of remittances have been channelled to Pakistan in the last one year through UBL,” it said.

UBL reaffirmed its commitment to expanding the suite of services for non-resident Pakistanis, and said it would remain at the forefront of deposit mobilisation under the Roshan Digital Account.

Lucky Cement Q1 profit jumps 132pc

Lucky Cement Limited profit jumped 132 percent to Rs2.226 billion in the first quarter ended September 30, 2020, translating into earnings per share (EPS) of Rs6.89, a bourse filing said on Monday.

The company earned Rs955.9845 million with EPS of Rs2.96 in the same quarter last fiscal. It did not announce any dividend for the quarter under review. Net sales climbed 48 percent to Rs14.335 billion in Q1, up from Rs9.628 billion in the same quarter last fiscal.

Saad Hanif of Insight Securities attributed it to higher dispatches, as well as decline in cost of goods, “thanks to lower coal price and better fixed cost absorption”. On consolidated basis, the company posted EPS of Rs13.45 versus Rs3.9 in the same period last year, mainly because of increase in profits of both KIA Lucky Motors and foreign cement and clinker operations, he added.

Brokerage Arif Habib Limited in its note said the company’s top line witnessed a surge on 49 percent YoY jump in off-take to 2,430,000 tons together with improvement in retention prices (cut in federal excise duty to Rs1,500/bag from Rs2,000/bag in the same period last year, as well as uptick in MRP in the north region).

Other income of the company arrived at Rs602 million in Q1FY21, down by 35 percent YoY amid lower cash balance, while up three times QoQ attributable to recognition of dividend income from ICI (Rs5/share).

Distribution costs during the period under review displayed a growth of 39 percent YoY to Rs1,357 million in lieu of a 50 percent YoY jump in company exports to 764,000 tons.

Effective taxation was booked at 17 percent in the quarter compared to 6 percent in July-September FY2019.

MTL profit soars 183pc to Rs1.291bln in Q1

Millat Tractor Limited (MTL) profits spiked 183 percent to Rs1.291 billion in the quarter ended September 30, 2020, with EPS of Rs25.93, a bourse filing said.

It earned Rs456 million with EPS of Rs9.16 in the corresponding quarter last fiscal. The company did not announce any interim dividend for the quarter. Syed Fawad Basir of Topline Securities said, “The result came in higher than industry expectations, but in line with our estimate.” The company’s unit sales clocked in at 7,225 units during Q1FY21, depicting a 50 percent YoY and 19 percent QoQ increase in volumes.

Net sales of the company surged 20 percent QoQ and 67 percent YoY, whereas gross margins improved from 21 percent in Q4FY20 to 22 percent in Q1FY21, analysts said. Brokerage Arif Habib Limited in its note said it was due to increase in tractor prices along with growth in sales volumes by 50 percent YoY and 19 percent QoQ to 7,225 units compared to 4,829 units in Q1FY20 and 6,095 units in Q4FY20.

Finance cost of the company has declined by 97 percent YoY and 94 percent QoQ, as the burden of short-term borrowings to manage the company’s working capital requirements has significantly decreased.

Effective tax rate of the company clocked in at 24.2 percent in Q1FY21 compared to 30.3 percent in Q1FY20.

Kohat Cement posts Rs507mln Q1 profit

Kohat Cement Company Limited posted profit of Rs507 million for the quarter ended September 30, 2020, translating into EPS of Rs2.52, a bourse filing said. It earned Rs88 million with EPS of Rs0.44 in the corresponding quarter last year. The company did not announce any interim cash dividend for the quarter ended September 30, 2020.

Brokerage Arif Habib Limited in their research note said the cement company displayed a top line surge of 73 percent YoY/90 percent QoQ during the quarter under review to Rs5.2 billion, led by 71 percent YoY/60 percen QoQ jump in off-take to 905,000 tons and recovery in retention prices (cut in FED and higher MRP).

Gross margins arrived at 18.5 percent in Q1FY21 from 4.1 percent in the same period last year, attributable to strong top line growth as well as soft coal prices which offset the impact of rupee depreciation, higher energy tariffs and costs associated with the new plant. Whereas margins recuperated drastically on a QoQ basis from 1.1 percent in Q4FY20 given improvement in top line and lower coal prices, the brokerage house added.

Finance costs displayed a decline of 18x YoY / 36 percent QoQ to Rs138 million in Q1FY21 amid cut in SBP’s benchmark rate. The company booked effective tax rate of 27 percent versus 25 percent in the same period last year.

HabibMetro nine-month profit rises 58.5pc

HabibMetro Bank posted a profit-before-tax of Rs13.8 billion for the nine months ended September 30, 2020, with a healthy growth of 58.5 percent year-on-year, a statement said on Monday.

The bank’s total assets increased 9.7 percent to Rs943 billion and deposit base increased 7 percent to Rs654 billion, it added.

The bank registered continued growth in its trade finance business, despite the slowdown in the global economy and trade activity. It also posted an increased EPS of Rs7.89, compared with Rs4.78 in September 2019.

The Pakistan Credit Rating Agency (PACRA) assigned premium credit ratings of AA+ and A1+ to HabibMetro Bank for the 19th consecutive year. The bank currently operates with 400+ branches in more than 135 cities across Pakistan.

Nestlé earns Rs88.7bln profits in nine months

Nestlé Pakistan earned a revenue of Rs88.7 billion for the nine-months period ended September 2020, registering an increase of 1.9 percent, compared with the corresponding period last year, despite many difficulties emanating from the COVID-19 crisis, a statement said on Monday.

Dairy and Nutrition products are the main contributors to this growth, as sales of liquid beverage products were negatively impacted by the COVID-19, it added.

The company launched several new products, including MilkPak Butter, Nescafé Ice 3-in-1, Nescafé Chilled Mocha, Fruita Vitals Kandahari Anaar and Lactogen Essential during the quarter ended September 2020.

Nestlé is adapting to the new normal, resulting from challenges brought on by the COVID-19 pandemic and will continue to drive efficiencies across the organisation and capitalise on

R&D capabilities to fulfill the needs of the consumers.

It has a strong brand equity and will continue with its efforts to achieve long-term sustainable profitable growth by successfully delivering on its promise of providing nutrition, health and wellness products, while ensuring the health and safety of its employees during this crisis and thereafter.