United Bank Limited (UBL) has announced its financial results for Q12018 where the bank reported earnings of Rs 2.64 billion, down by 63.62% as compared to Rs 7.25 billion in the corresponding period last year.
The earnings per share of the bank was down to Rs 2.16 from Rs 5.93.
Along with the result, UBL has announced an interim dividend of PKR 3/share.
The result was below the market expectations mainly due to the recognition of Rs 6.4 billion (Rs5.2/share before tax) one-off expense relating to pension case liability.
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In Q1 CY2018, Net Interest Income (NII) stayed flat YoY while Non-Markup Income surged by 11% mainly due to 34% higher capital gains in the quarter.
Provision expenses stayed on the higher side which can be attributed to provisioning expenses pertaining to the bank’s UAE loan book.
Non-core income of the bank increased by 16%YoY mainly on account of higher capital gains (Rs 3.1billion) whereas operating costs of the bank remained relatively flat (+2%YoY), which alleviated some pressure on bank’s bottom-line.
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On a sequential basis, PBT ( Pension costs ) was up 18.9% on the back of higher capital gains which more than offset the decline in fee income of 21.1% and 14.6% increase in provisioning costs.
The non-mark up income grew by 15% YoY to Rs 8 billion with a 34% increase in gain on sale of securities.
UBL’s share at the bourse closed at Rs 201.30, down by 0.16% with a turnover of 0.57 million shares.
| Unconsolidated Profit and Loss Account – For the Three Months Ended, March 31st 2018 | |||
| Key Financials | March, 2018 | March, 2017 | % Change |
| Amounts in PKR ‘000 | |||
| Net mark-up/return/interest earned | 28,146,657 | 23,888,226 | 17.83% |
| Net mark-up/return/interest earned after provisions | 11,869,414 | 13,616,555 | -12.83% |
| Fee, commission and brokerage income | 2,946,665 | 2,786,924 | 5.73% |
| Dividend Income | 570,910 | 552,168 | 3.39% |
| Income from Foreign Currencies | 535,561 | 418,213 | 28.06% |
| Capital gain on sale of securities – net | 3,067,094 | 2,340,505 | 31.04% |
| Other income | 189,762 | 183,345 | 3.50% |
| Total non-mark-up/interest income | 7,309,287 | 6,275,556 | 16.47% |
| Administrative Expenses | 8,654,926 | 8,519,662 | 1.59% |
| Other provisions – net | 73,038 | 15,828 | 361.45% |
| Other charges/reversals | 432 | 318 | 35.85% |
| Total non-mark-up/interest expenses | 8,706,147 | 8,736,450 | -0.35% |
| Profit before Extraordinary/unusual item and taxation | 10,472,554 | 11,155,661 | -6.12% |
| Extraordinary Item – Pension Cost | 6,404,635 | – | |
| Profit before Taxation | 4,067,919 | 11,155,661 | -63.62% |
| Profit after Taxation | 2,645,253 | 7,255,145 | -63.59% |
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