Kot Addu Power Company Limited (KAPCO) announced its 2QFY22 financial result today where the company posted a profit after tax (PAT) of PKR 3,328mn (EPS: PKR 3.78), down by 37% YoY compared to PKR 5,296mn (EPS: PKR 6.02) during the same period last year. This took the 1HFY22 earnings to PKR 5,608mn (EPS: PKR 6.37), down by 51% YoY compared to PKR 11,498mn (EPS: PKR 13.06).

Result Highlights

· During 2QFY22, sales increased by 83% YoY to PKR 19.5bn, due to higher dispatches (+129% YoY, 734 GWh) along with higher prices of RLNG (+133% YoY) and FO. During 1HFY22, sales also increased by 58% YoY due to 24% YoY rise in dispatches to 2,470 GWh.

· During 2QFY22, gross margins clocked-in at 9% compared to 52% during same period last year. The primary reason behind shrunk margins was a decline in Capacity Purchase Price (CPP).

· During 2QFY22, other income increased by 27% YoY | 40% QoQ to PKR 3.9bn due to higher interest rates and tariff true up, we view.

· Finance cost also increased by 16% YoY during 2QFY22 on the back of higher interest rates.

Courtesy – AHL Research