Engro Fertilizer Limited (EFERT) is expected to announce the financial result for 9MCY24 on 14th Oct’24. We expect the company to post a profit after tax of PKR 14,702mn (EPS: PKR 11.01), witnessing a decrease of 2% YoY on account of a 23% decline in urea sales. On a quarterly basis, profitability is expected to arrive at PKR 5,276mn (EPS: PKR 3.95), down 45% YoY.
Net sales are expected to decline by 14% YoY to PKR 56,766mn during 3QCY24 amid reductions in urea and DAP sales by 33% and 14% YoY, respectively. Gross margins are expected to settle at 23.61% during 3QCY24 vis-à-vis 31.72% in SPLY owing to higher gas prices coupled with lower urea dispatches. Furthermore, financial charges are projected to climb up by 3.3x YoY to PKR 1,634mn, given the surge in short-term borrowings.
Other income is anticipated to reduce by 41% YoY to PKR 433mn due to lower income from cash and cash balances, given a decline in interest rates. On a QoQ basis, the bottom line is forecasted to augment by 3.2x amid a 52% QoQ jump in urea sales, given the resumption of operations at EFERT’s EnVen Plant post-BMR.
EFERT will likely announce a cash dividend of PKR 3.00/share (PKR 14.00 in 9MCY24).