The FFC announced its 3QCY25 financial results, reporting standalone earnings of PkR19.2bn (EPS: PkR13.48), down 23%YoY from PkR24.8bn (EPS: PkR17.44) in SPLY. Earnings came in slightly below our expectations due to lower-than-anticipated margins. Alongside the result, FFC announced a cash dividend of PkR9.5/sh:

·        Company’s revenue increased by 18%YoY to PkR127.3bn compared to PkR108.0bn in SPLY, primarily driven by 14%/11% YoY increase in urea and DAP offtakes to 834k and 253k tons, respectively.

·        Gross margins contracted to 30.8% from 37.3% in SPLY, primarily due to discount offering on urea and lower margins on DAP during the quarter. Margins remained below expectations due to higher-than-anticipated Phosacid prices, in our view.

·        Distribution expenses increased by 5%YoY to PkR8.6bn, mainly due to higher offtakes during the quarter.

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