BIFO held its analyst briefing earlier today to discuss their FY23 financial performance and future outlook. Following are the key highlights of the briefing:

• To recall, company posted earnings of PkR13.1/sh in FY23 vs. PkR5.34/sh in SPLY, an increase of 1.5xYoY. The said increase is primarily attributable to increase in sales volumes and improvement in gross margins.
• Company’s exports have doubled in FY23 owing to supplies made to mining endeavors in Baluchistan, i.e; Duddar and Saindak (classified as exports due to mining location being declared as export processing zones).
• Overall, significant increase in the supplies was made in the Oil & Gas and Mining sector in FY23.
• On the Thar coal mining end, BIFO’s management stated that were in touch with the said mining venture but nothing significant has materialized since Thar is only using imported products.
• Meanwhile, company is in touch with other coal and salt mining projects in the country. Additionally, company is in touch with other upcoming mining ventures as well, i.e NRL (Natural Resources (Pvt) Ltd.).
• Furthermore, company is actively perusing CPEC infrastructure development and Hydropower projects to enhance its market share.
• Management apprised that they are in touch with the local office for Reko Diq and if the mining venture matures, it would enhance company volumes.
• To enhance the capacity utilization, company is making efforts to improve its exports and exploring opportunities in Africa and Europe.
• Company has successfully made supplies to North Sudan in previous year, however due to eruption of war, receipts of Export proceeds were delayed. Management stated that transfer of funds have been initiated and expects to receive payment shortly.
• As per management, ~70-80% of the company’s raw material is imported, meanwhile, company is trying to increase their reliance on local resources to reduce their dependency on imported raw material without compromising the finished products.
• Going forward, management expects huge growth in topline and profitability

Courtesy – AKD Research