Fauji Fertilizer Company Limited is expected to disclose its 9MCY22’s financial result on 26th Oct’22, where we expect earnings to clock-in at PKR 15,105mn (EPS: PKR 11.87), down by 5% YoY given super tax levied on PBT of CY21 and 9MCY22. On a quarterly basis, the net profit is anticipated to plummet by 15% YoY, settling at PKR 5,506mn (EPS: PKR 4.33) in 3QCY22. The decline in profitability comes amid massive drop in urea and DAP sales by 25% and 85% YoY, respectively amid floods.

Gross margins are expected at 41.8% in 3QCY22 versus 37.8% in 3QCY21 due to higher urea prices and lower DAP offtake. Furthermore, the other income is expected to ascend by 146% YoY in 3QCY22, arriving at PKR 4,176mn amid higher income from cash and cash balances. Furthermore, financial charges are expected to arrive at PKR 2,573mn, up by 4x YoY on account of higher interest rate and short term borrowing. Alongside this, the company is expected to announce a cash dividend of PKR 3.00/share in 3QCY22 (9MCY22: PKR 3.75/share).

Courtesy – AHL Research