ICI Pakistan Limited is expanding business. 1) expansion in the company’s Soda Ash manufacturing facility to 560k tons per annum from the current capacity of 425k tons per annum, ii) improved margins of PSF business due to specialty fiber, iii) successful commissioning of NutriCo Morinaga (Private) Limited, iv) transformation of Pharma Business which is growing faster than the market, (v) expected growth in textile chemicals, polyurethane, and Agri sciences and, (vi) diversified products’ portfolio and businesses.

Meanwhile, ICI Pakistan Limited (ICI) announced its 1QFY22 financial result today where the company posted a profit after tax (PAT) of PKR 3,602mn (EPS: PKR 39.00), up by 266% YoY compared to PKR 985mn (EPS: PKR 10.66) during SPLY.

Result Highlights

·        During 1QFY22, net sales surged by 48% YoY to PKR 21,468mn due to augmented sales across all segments, supporting the overall jump.

·        Gross margins of the company went up by 297bps YoY to 22% during 1QFY22 and by 188bps on a QoQ basis. The rise in gross margins was led by better performance of Animal Health, PSF and Pharma segments, we view.

·        During the quarter, the company also booked a one-off gain on re-measurement of existing interest in NutriCo Pakistan (Pvt.) Limited of PKR 1,847mn (PKR 20.00/share). The increase in earnings was aided by recognition of this one-off gain; however, if we exclude the on-off income, payments for 1QFY22 will arrive at PKR 19.00/share.

·        During 1QFY22, ICI also booked an exchange loss of PKR 129mn amid PKR depreciation during the quarter.

·        Finance costs of the company went down by 23% YoY to PKR 218mn, given lower levels of borrowings compared to the same period last year.

Courtesy – AHL Research