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Engro Corporation saw a decline in its profit during 9MCY24

  • Engro Corporation Limited (ENGRO) announced its 9MCY24 financial result with a consolidated profit after tax of PKR 11,983mn (EPS: PKR 22.33), a 48% decline YoY. On a quarterly basis, the consolidated earnings clocked in at PKR 5,722mn (EPS: PKR 10.66), plunging by 53% YoY. Alongside the result, the company announced a PKR 5.00/share dividend in 3QCY24 (PKR 24.00/share in 9MCY24).

Result Highlights       

  • On the fertilizer business front, EFERT’s earnings settled at PKR 8,554mn (EPS: PKR 6.41), declining by 11% YoY during 3QCY24. This is due to i) a 33% and 14% YoY fall in urea and DAP offtake, respectively, and ii) higher finance costs amid a jump in short-term borrowings.
  • Meanwhile, Engro Polymer & Chemicals Limited (EPCL) registered a loss of PKR 698mn (LPS: PKR 0.77) compared to a net profit of PKR 2,642mn (EPS: PKR 2.91) due to higher gas prices and subdued PVC margins.
  • FCEPL posted earnings of PKR 766mn (EPS: PKR 1.00), up 3x YoY on the back of an increase in gross margins by 190bps to 15.40% amid higher sales of dairy products.
  • ENGRO’s other income jumped 53% YoY during 3QCY24, which is attributable to a surge in income from cash and cash balances.
  • 41% YoY augments the company’s finance cost on the back of higher short-term borrowings.
  • The company booked a gain on allowance on subsidy receivable from the government of PKR 464mn in 3QCY24 against a gain on allowance on subsidiary receivable from the government of PKR 1mn in 3QCY23.
  • The company booked effective taxation at 39.95% in 3QCY24 vis-à-vis 40.54% in 3QCY23.

Courtesy – AHL Research

Meanwhile, a company statement says that the Corporation’s revenue from continued operations grew by 12% to Rs. 279 billion, compared to Rs. 250 billion in 2023.
Consolidated profit after tax (PAT) attributable to shareholders from continued operations stood at Rs. 10.6 billion (EPS: Rs. 19.68), up from Rs. 9.9 billion (EPS: Rs. 18.13) last year. Responsive pricing strategies and cost optimization primarily drive higher profitability.

The Company also announced an interim cash dividend of Rs. 5 per share in the third quarter. This payout is in addition to the Rs. 19 per share dividend already announced in the first half, bringing the cumulative nine-month dividend to Rs. 24 per share.

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