Like its sister concern NPL, Nishat Chunian Power Limited posted a hefty increase in its net earnings in 1QFY15. The rise of 41percent year-on-year in the bottom line came from higher fuel savings and lower O&M expenditure – just like Nishat Power Limited.
With a top line growth of five percent year-on-year,a nd no significant change in the cost of sales, fuel savings escalated due to better fuel efficiency and higher utilisation of around 88 percent in 1QFY15 as against 80 percent in 1QFY14.
Meanwhile, finance cost can be seen to have jumped up as circular debt has gained momentum once again.
Though the firm was able to post significant increase in year-on-year earnings, future profitability of the firm will remain under check due to the ongoing repair and overhaul at the plant facility. Also, the resurgence of circular debt and the investment in coal power project eating away the dividends might keep shareholder wary.
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Nishat Chunian Power Limited (NCPL)
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Rs (mn) 1QFY15 1QFY14 YoY
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Sales 6,860 6,550 5%
Cost of sales 5,581 5,551 1%
Gross profit 1,279 999 28%
Administrative expenses 29 24 21%
Other expenses 10 56 -82%
Other income 9 7 21%
Finance cost 537 421 28%
Profit after tax 711 505 41%
EPS (Rs/share) 1.935 1.374 41%
Gross margin 18.6% 15.3%
Net margin 10.4% 7.7%
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Source: KSE Notice
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