The Hub Power Company (HUBC) announced its 4QFY23 result earlier today, where the company reported consolidated quarterly earnings of PkR23.9bn (EPS: PkR18.43), up by 112%QoQ/241%YoY. This takes cumulative earnings for the full year to PkR57.5bn (EPS: PkR44.37), up by 102%YoY.

· Consolidated revenue for the quarter clocked in at PkR32.3bn, up by 19%QoQ as the newly operational subsidiaries i.e. TEL & TNPTL’s load factors, rose significantly throughout the quarter alongside CPHGC’s strong reemergence during the period. Base/CPHGC/TEL/TNPTL/Narowal/Laraib’s load factor stood at 0%/9.5%/55%/87%/34%/75% during the quarter. Furthermore, revenues remained up during the quarter due to the currency deprecation as well, as the avg. PkR/USD parity weakened by 10% between 3QFY23 and 4QFY24, contributing towards growth in capacity charges.

· Share of profit from associates jumped significantly during the quarter, up by 128%QoQ/272%YoY, clocking in at PkR14.7bn. Successful COD of ThalNova Power plant during the year, alongside possible inclusions of ENI and SECMC profits, are likely to have contributed to the sharp increase.

· Finance costs rose by 58%, clocking in at PkR7.48bn during the quarter. This is likely because of higher borrowings to finance the newly operational Thalnova plant alongside higher reliance on ST borrowings amidst a tighter working capital situation.

· The company has also announced, above our expectations of PkR3.0/sh. This takes the cumulative payout for the year to PkR30.0/sh, amounting to a payout ratio of 68%.

Courtesy – AKD Research