Engro Fertilizer Posts No Profit Growth in H1 2019

Engro Fertilizers Limited has announced its financial results for the half-year that ended on June 30, 2019. The company booked a profit of Rs. 7.18 billion which remained flat as compared with Rs 7.14 billion profit earned in the previous year.

The profits remained flat due to higher finance costs and operating expenses.

The company reported a revenue of Rs. 50.64 billion, which was up by 23.17% as compared with Rs. 41.11 billion in the same period last year. Despite a reduction in volumetric sales by 9%, the company achieved growth in its revenues on the back of higher prices of urea.

For the year under review, the company also announced its first interim cash dividend of Rs. 5/share.

The finance cost of the company increased by 128% to Rs 2.01 billion against Rs. 886 million due to the increase in policy rates and borrowings. Other income was up by 47.50%, which was stated at Rs. 2.43 billion as compared with Rs. 1.65 billion. According to Topline Securities, it increased on account of sale of certain assets.

Consolidated Financial Results for the Half Year ended June 30, 2019 (Amounts in Thousands except earnings per share)
Jun-19 (Rs) Jun-18 (Rs) % Change
Net sales 50,642,948 41,116,414 23.17%
Cost of sales (34,527,984) (27,096,110) 27.43%
Gross profit 16,114,964 14,020,304 15.00%
Selling and distribution expenses (3,380,782) (3,272,515) 3.31%
Administrative expenses (590,983) (512,045) 15.42%
Other income 2,438,382 1,654,086 47.42%
Other operating expenses (986,740) (571,921) 72.53%
Finance cost (2,019,147) (886,141) 127.86%
Profit before taxation 11,575,694 10,431,768 10.97%
Taxation (4,391,519) (3,282,392) 33.79%
Profit for the period 7,184,175 7,149,376 0.49%
Earnings per share – basic and diluted 5.38 5.35 0.56%

 

The results were below the market expectations.

EFERT’s script at the bourse closed at Rs. 63.87, up by Rs 1.88 with a turnover of 2,518,000 shares on Thursday.



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